Preamble

The House met at half-past Two o'clock

PRAYERS

[Mr. SPEAKER in the Chair]

DEATH OF A MEMBER

Mr. Speaker: I regret to have to inform the House of the death of Patrick Bartley, esquire, Member for Chester-leStreet, and I desire on behalf of the House to express our sense of the loss we have sustained and our sympathy with the relatives of the honourable Member.

PRIVATE BUSINESS

SCOTTISH UNION AND NATIONAL INSURANCE COMPANY BILL

BEDFORD CORPORATION BILL

BOURNEMOUTH-SWANAGE MOTOR ROAD AND FERRY BILL

Lords Amendments considered and agreed to.

TYNE TUNNEL BILL [Lords]

As amended, considered; to be read the Third time.

FYLDE WATER BOARD BILL [Lords]

To be read a Second time Tomorrow.

RHYL URBAN DISTRICT COUNCIL BILL [Lords]

BARNSLEY CORPORATION BILL [Lords] (By Order)

Read a Second time and committed.

Oral Answers to Questions — MINISTRY OF SUPPLY

Aircraft Engines (Noise)

Mr. Beswick: asked the Minister of Supply the progress made to date on methods for reducing aircraft engine noise at source; what devices have been developed, respectively, by private aircraft firms and by institutions financed by his Department; and to what extent the muffling rings so far developed are being applied to current production.

The Minister of Supply (Mr. Reginald Maudling): The most promising method of reducing jet aircraft engine noise at source is the corrugated jet nozzle which is being developed by Messrs. Rolls Royce, under contract with my Department. Full-scale flight tests are in progress, but the development has not yet reached the stage when these nozzles can be applied to current production. The same company is also developing a type of suppressor which is basically an annular jet.
The efforts of private aircraft firms have been largely directed towards reducing the noise from ground running of engines by means of pens and mufflers. My Departments also assists fundamental research into noise at some of our universities and has contracts with one leading aircraft company for research into high speed propeller noise and with another for investigations into helicopter noise.

Mr. Beswick: While thanking the Minister for that full information, may I


ask him three questions? First, can he give an assurance that research is not being hampered by lack of funds; secondly, can he give the House any idea when some of these developments are going to be in operation, and, thirdly, is he satisfied that there is liaison with other nations of the world, especially the United States, which are faced with the same problem?

Mr. Maudling: I think that a very adequate amount of finance is being put behind this development, but the hon. Gentleman knows full well how uncertain development is in this field. I should not like to make any predictions in point of time. I think that there is a very good exchange of information on these matters, particularly with the United States, but I will certainly follow up the hon. Gentleman's suggestion to see if we cannot do more on that line.

D.R.2 Aircraft Flights (Complaints)

Mr. Beswick: asked the Minister of Supply what complaints of damage were made to his Department following the recent world record speed flight by the D.R.2 aircraft; what investigations he has made into these complaints; and if he will make a statement.

Mr. Maudling: Up to 31st May we had received about 160 complaints, mostly of a minor nature. We have followed the normal procedure of investigation, and a few of the complaints have also been investigated by the Building Research Station which is studying the effects of supersonic bangs on buildings.
I regret that this series of flights should have given rise to an exceptionally large number of claims, but this prototype aircraft could not be hazarded in supersonic flight over the sea and, in any case, it would have been impracticable to measure its speed otherwise than in flight over land. In general, the measures I announced on 11th July, 1955, have been very effective; most supersonic flights take place without causing damage.

Mr. Beswick: While not in any way deprecating that record flight, would the Minister not agree that there is here a most serious social problem? In some of these areas, in part of the South Coast especially, life is being made quite intolerable by these repeated exercises. Is

adequate compensation being paid in these cases, and is the right hon. Gentleman satisfied also that everything is being done to minimise the damage that is caused?

Mr. Maudling: While we do not accept liability in these matters, we do pay compensation as if liability rested upon the Crown. The number of supersonic bangs taking place is much less than a year ago, but I agree that this is a serious problem, and the Building Research Station is embarking on a long-term study of the whole effects of jet flying on buildings.

Mr. Beswick: Can the Minister publish some of the results of the inquiries which have taken place, because this is a problem about which the country as a whole ought to be informed?

Mr. Maudling: We did publish some of the results of an investigation carried out by the Royal Aircraft Establishment at Farnborough, and as soon as anything more useful is available I will certainly publish it.

Civilian Staff

Mr. Gough: asked the Minister of Supply the total number of persons employed by his Department; and what reduction in that number he hopes to make by the end of 1956.

Mr. Maudling: The total number of civilians employed by my Department on 1st April, 1956, was 105,529, of whom 34,639 were non-industrials. A special review is now being undertaken to find ways and means by which the number of these latter can be reduced, but I am not yet able to estimate results likely to be achieved by the end of the year.

Mr. Gough: May I thank my right hon. Friend for that information and ask him to do everything possible to avoid what many people think is a duplication of work between his Ministry and the various Service Ministries?

Mr. Maudling: I am concerned at the amount of manpower, particularly scientific and technical, absorbed by my Department, and I hope to be able to reduce it.

Nuclear Weapons

Mr. Emrys Hughes: asked the Minister of Supply what sum was spent on the development and manufacture of nuclear weapons during the years 1951 to 1955.

Mr. Maudling: It would not be in the public interest to give this information.

Mr. Hughes: While I thank the Minister for that reply, which appears to be his usual answer to my Questions, does he recollect the ferocious attack made by his right hon. Friend the Member for Woodford (Sir W. Churchill) on the Labour Government for spending £100 million, so he used to say, without telling the House? Is the Minister following that precedent? If the figures for expenditure could be given during the time of the Labour Government, why are the Tory Government ashamed to give them?

Mr. Maudling: I do not think it has been the practice of any Government to reveal the amount spent on atomic weapons, which is what the Question refers to.

Government Contracts (Security)

Mr. W. Griffiths: asked the Minister of Supply in how many cases his Department has represented to employers that an employee was a security risk; and in how many cases the employers concerned have taken action in regard to their employees as a result of such representations.

Mr. Maudling: I would refer the hon. Member to the replies given to the then hon. Member for Broxtowe (Mr. Warbey) on 15th and 18th March, 1954, of which I am sending him copies. Mr. Lang's case is the only one subsequent to those seven in which these contractual powers have been involved.
Contractors have always been obliged to exclude from access to Government secrets employees regarded as security risks. In view of the length of time during which this procedure has been operating, it is not possible to give the figure for which the hon. Member asks.

Mr. Griffiths: Is the Minister aware that, although the number of men involved is not very great, nevertheless some of them have strenuously denied the suspicions and allegations which have been brought against them, but have not been as fortunate as Mr. Lang in their publicity? Can the reight hon. Gentleman not now tell the House that he is willing, retrospectively, to apply the procedure of the advisory tribunal to any men—and

there are some of them—who still affirm that they have been dealt with unjustly?

Mr. Maudling: The Privy Council has recommended the application of the three advisers procedure to a certain range of cases, and that is being done, but in cases where Ministers have reached a decision I do not think the retrospective application of that procedure would serve any purpose.

Lieut.-Colonel Lipton: asked the Minister of Supply how many persons employed in his Department have been dismissed or transferred to other work on security grounds during each of the last three years; and in how many cases private firms employed on Government contracts were informed that they would not be given Government contracts in future unless they took similar action.

Mr. Maudling: In 1953, one officer in my Department was dismissed and two transferred to other work on security grounds; in each of the years 1954 and 1955, two officers were transferred and none dismissed. There has been no case in the current year. The case of Mr. Lang is the only occasion on which the placing of further secret contracts has been made dependent on action being taken in regard to a named person.

Lieut.-Colonel Lipton: Will the right hon. Gentleman give us an assurance that, in all these cases, the person concerned was first given adequate details of the complaint against him and then a proper opportunity of being heard in his own defence?

Mr. Maudling: In all the cases I have referred to, the procedure laid down originally in 1948 has been followed.

Imperial Chemical Industries, Limited (Mr. J. H. Lang)

Mr. W. Griffiths: asked the Minister of Supply upon what date representations were made to Imperial Chemical Industries, Limited, by his Department concerning their employment of Mr. J. H. Lang: and what answer was received from Imperial Chemical Industries, Limited.

Mr. Grimond: asked the Minister of Supply why no effort was made between 1951 and 1956 to keep secret information from Mr. Lang, as he was considered a bad security risk in 1951.

Mr. Maudling: Imperial Chemical Industries, Limited, were informed in July, 1951, that Her Majesty's Government would not wish Mr. Lang to be given access to secret information arising on Government contracts and the company undertook to do their best to ensure this. In November, 1955, the company reported that they had found themselves unable in practice to deny Mr. Lang access. After consideration of this report by Her Majesty's Government, the Treasury Solicitor wrote to the company on 4th January, 1956, to say that the responsible Ministers regarded it as an essential condition of placing further secret contracts with the company that the company should be able to undertake that Mr. Lang would not have access to secret information disclosed in connection with those contracts.

Mr. Griffiths: Is it not a fact that, in 1951, the I.C.I. considered that the Minister of the day was bringing a ludicrous charge against Mr. Lang, and did they not then and from time to time afterwards resist the Government's attempts to have him sacked, until the right hon. Gentleman's Government came along and used the blackmail methods of withholding contracts from the I.C.I. unless they complied with the Government's request? Is this not proof, as I said the other day, that this procedure has been much extended latterly?

Mr. Maudling: No. That is a distortion of the position. The Government have never pressed for the dismissal of Mr. Lang. What we have always said throughout is that we did not wish him to have access to Government secret information.

Mr. Grimond: Is it not rather disturbing that, if Mr. Lang had access to secret information for four years, if in fact he was a Communist he could have done great damage to the country in that time? Secondly, has any fresh evidence against Mr. Lang come to the notice of the right hon. Gentleman's Department in those four years?

Mr. Maudling: We had always hoped that it would be possible to ensure that Mr. Lang would not have access to secret information and nevertheless be able to remain in his job. It was only when it became apparent to us, on the information given by the company, that this could

not continue that we had to say that we would have to make it a condition of placing contracts that he was not given access to secret information.

Mr. Younger: Is the Minister aware that the House is very anxious that this type of security procedure should be applied only in cases which are of the utmost security importance? In those circumstances, is it not rather disturbing that apparently, according to the account just given by the right hon. Gentleman, the Government did not take effective steps over four years to see whether Mr. Lang was, in fact, having access to secret material? It appears that he was. Does this not indicate that this is not perhaps one of the highest grade security cases in which the House is content to see this security procedure applied?
On a rather different aspect of the case, may I ask the right hon. Gentleman whether he has taken into account the fact that when the decision was first taken against Mr. Lang—that was in 1951—Mr. Lang's wife's Communist associations were then quite recent but that five years or more have elapsed, apparently, without any continuation? Is that not a relevant factor which ought to lead to reconsideration of the case?

Mr. Maudling: Of course, the original view was taken by the preceding Administration, but neither Government has been prepared at any time to agree that Mr. Lang should have unrestricted access to the secret information coming into the possession of I.C.I. As I said, it was hoped for some time that it would not be necessary for Mr. Lang to have such access, because the secret information contained in contracts does not necessarily come into the possession of the legal officers of the company concerned. It was only after a period of time that it became obvious, from what I.C.I. told us, that Mr. Lang could no longer be excluded from such information. When we were told that, we said we should have to make it a condition of the contracts that he should not have access.

Mr. J. Griffiths: Since the Government have now decided, I understand, that the Civil Service procedure of the tribunal shall apply to these cases which arise in industry, why will the Government not allow Mr. Lang, if he desires, to appeal to that tribunal?

Mr. Maudling: Because the responsible Ministers considered this case with great care, at great length, and with all the information at their disposal, and there does not seem to be any object in going over the same ground again.

Designers and Engineer Draftsmen

Mr. Stokes: asked the Minister of Supply how many designers and engineer draftsmen are employed in the various sections of his Department, including those seconded from the three Service Departments.

Mr. Maudling: About 1,500.

Price Increases

Mr. Lewis: asked the Minister of Supply whether he will give an assurance that he will take such action as may be deemed necessary to ensure that there will be no price increase during the next six months in the goods and services coming within the control of his Department so as to assist in curbing the inflationary spiral.

Mr. Maudling: As has been explained by the Prime Minister, it is the Government's view that the national interest requires that prices should be kept down wherever possible. I shall naturally bear this in mind along with other relevant considerations in deciding policy.

Mr. Lewis: While I thank the Minister for bearing it in mind, can I now have a definite assurance or answer, yes or no, as to whether he will do the same as the nationalised industries: namely, not put up the prices for the next six months?

Mr. Maudling: As my main concern is not to sell but to buy things, I should hope to get prices down.

Spadeadam Rocket Station (Housing)

Mr. Speir: asked the Minister of Supply where it is proposed to site the new houses to be occupied by the permanent staff to be employed at the new Spadeadam experimental rocket station.

Mr. Maudling: No decision has yet been reached on a site for these houses.

Mr. Speir: Will my right hon. Friend ensure that very careful consideration is given to this subject, which is of great

local importance, and will he in particular ensure consideration of Haltwhistle, where there are ample sites and services?

Mr. Maudling: Yes, certainly. I am aware of what my hon. Friend says. Haltwhistle is one of the possibilities. I recognise that there are considerable advantages in this possibility, although there are other possibilities as well.

Mr. Whitelaw: Is my right hon. Friend aware that there is considerable good will locally for this project, because there are hopes that it will bring to the area not only houses but also electricity and improved water supplies? Will he do his best to ensure that those hopes are not disappointed in the final event?

Mr. Maudling: I am delighted when anyone welcomes the incursion of the Ministry of Supply.

Factory, Girvan

Mr. Emrys Hughes: asked the Minister of Supply what expenditure he has incurred on the factory near Girvan since 1951; how many men are now employed there; and for what purpose.

Mr. Maudling: Excluding certain non-recurrent expenditure incurred at the beginning of the rearmament programme, over the past five years the costs at this factory have been approximately £20,000 per annum. Thirty men are at present employed on its protection and maintenance.

Mr. Hughes: Will the right hon. Gentleman consider whether there is any possibility of this factory being used for some more useful purpose and for employing people on more productive work?

Mr. Maudling: Certainly, I will do my best to examine any suggestion.

Long-Range Jet Aircraft

Mr. Beswick: asked the Minister of Supply what specifications have been put to the aircraft industry for a long-range passenger jet aircraft; what response there has been from the industry; what now are the possibilities of producing a British aircraft of this type; and if he will make a statement.

Mr. Maudling: As the hon. Member was informed on 13th February, an outline specification for such an aircraft


has been prepared by my Department, in conjunction with British Overseas Airways Corporation and has been sent to the manufacturers. A number of design studies have been submitted and they are being considered, but it is too early to make any statement.

Mr. Beswick: Is it not now clear that, every operator in the world except the British being now committed for this type of aircraft, we have lost the chance of selling these machines in the world market? Does it not now appear also that the Department made a mistake when it cancelled the order for the V1000?

Mr. Maudling: I do not accept for a moment that we have lost our position in the world market. These are difficult and complicated matters, but if we choose wisely we can and will still build an extremely successful long-range jet passenger aircraft.

Oral Answers to Questions — AGRICULTURE, FISHERIES AND FOOD

Food (Colouring Substances)

Mr. Dodds: asked the Minister of Agriculture, Fisheries and Food if he will make a statement in respect to the recommendations of the sub-committee of the Food Standards Committee on colouring substances in food.

The Minister of Agriculture, Fisheries and Food (Mr. D. Heathcoat Amory): Yes, Sir. The Government have decided to accept the recommendation that only certain specified colours should be permitted in food, and that these should be the colours proposed by the Food Standards Committee. I will circulate a more detailed statement in the OFFICIAL RFPORT.

Mr. Dodds: While thanking the Minister for his statement and while waiting to read it, may I ask whether in the meantime there will be a ban on painting kippers with coal-tar dye?

Mr. Amory: No, the recommendation of the Food Standards Committee was that the dyeing of kippers, provided that the dyes were not harmful, should not be restricted.

Following is the information:

The Government have considered these recommendations and the views of interested parties. They accept the recommendation that only certain specified colours should be permitted in food and that the permitted list should at present be limited to the colours proposed in the Food Standards Committee's Supplementary Report. The list as a whole will be reviewed in not more than 5 years' time. Meanwhile, the Government will be prepared to consider individual colours for addition to or removal from the list if further information becomes available; the procedure will be announced later. The Government will arrange for certain colours which traders regard as important but which on present information the Committee have not been able to include in the list, to be investigated further as a matter of priority.

The Government accept the recommendation that, except for marking purposes, colour should not be added to certain natural foods when sold raw or unprocessed. Special arrangements will, however, be made for citrus fruit in view of the difficulties of West Indian and other suppliers whose produce, because of climatic conditions, often does not ripen with a uniform appearance. These arrangements will permit the continued use of a colour on citrus fruit subject to safeguards for the consumer. The Committee's recommendations regarding the labelling or description of processed foods containing added colour will be considered when a comprehensive review of the Labelling of Food Order is undertaken.

The Government have decided that specifications of purity should be prescribed for colours on the permitted list. Colour manufacturers and the other interests concerned will be consulted about the arrangements required.

Regulations giving effect to these decisions will apply to all food whether home produced or imported, and will be made as soon as practicable. In deciding when they will come into effect, the Government will bear in mind the need to give manufacturers and traders time to dispose of stocks of food produced in accordance with existing regulations. But the Government hope that all who can do so will take steps immediately to use only colours on the permitted list.

Potatoes

Lieut.-Colonel Bromley-Davenport: asked the Minister of Agriculture, Fisheries and Food the total number of foreign new potatoes imported into this country since 1st June.

Mr. Amory: I regret that this information will not be available until the Trade and Navigation Accounts for June are published on or about 20th July.

Pig Herds (Artificial Insemination)

Mr. de Freitas: asked the Minister of Agriculture, Fisheries and Food whether he is aware of recent developments in the artificial insemination of


sows in ordinary commercial herds; and what he is doing to encourage this.

Mr. Amory: Yes, Sir. An artificial insemination service for commercial pig herds is being provided on a limited scale by several cattle A.I. centres. Various technical problems have to be overcome, however, before a full commercial service can be developed and research on these is being actively conducted by the Agricultural Research Council.

Mr. de Freitas: What is the Minister doing to encourage this, as it may do as much for pigs as artificial insemination has done for cattle?

Mr. Amory: I agree in thinking that this is likely to prove a very important development indeed. Research work into this problem is being actively pursued in the Agricultural Research Council's unit on Reproductive Physiology and Biochemistry at Cambridge, and will be, I hope, shortly at my own artificial insemination centre at Reading.

Annual Price Review

Lieut.-Colonel Bromley-Davenport: asked the Minister of Agriculture, Fisheries and Food on what date he issued his first statement of agreement with Sir James Turner on this year's global figure in connection with the Annual Price Review.

Mr. Amory: My first reference to the attitude of the farmers' unions was in my statement of 15th March in this House.

Lieut.-Colonel Bromley-Davenport: Was it due to any action by my right hon. Friend that Sir James Turner allowed 63 days to elapse after my right hon. Friend's first statement and 16 days after his second statement before disputing the accuracy of my right hon. Friend, and, if not, can he give any explanation why these statements were delayed so long?

Mr. Amory: I think that I can say in reply to my hon. and gallant Friend only that I believe that the position is now clear and generally understood, that the global award would have been agreed by the N.F.U.s conditionally on the Government's agreeing to their schedule of distribution. In that case there would have been an agreed settlement.

Fat Cattle (Guaranteed Prices)

Mr. Dye: asked the Minister of Agriculture, Fisheries and Food the guaranteed prices for fat cattle which the producers will receive in February, 1957, and the comparable prices for February, 1956 and 1955.

Mr. Amory: The guaranteed standard price for each month of the fatstock year 1956–57 is 151s. per live cwt. compared with 138s. 8d. in 1955–56 and 133s. 2d. in 1954–55. The returns received by producers in February next will depend upon market prices and payments due under the guarantees. Neither of these I am able to forecast.

Mr. Dye: Is it not this inability to forecast the actual income by farmers from fat cattle when marketed which has undermined their confidence in the guaranteed price of fat cattle?

Mr. Amory: I think the hon. Gentleman is aware that the present system is that the payments due represent the difference between the average market price over a period of 52 weeks prior to the date of payment and the standard price. I have always said that that system is the best which it has been possible to devise so far in consultation with the representatives of the producers. If we can find a better way of doing this we shall be very glad to consider it at any time, but it is so far the best system which has been found in the general interest.

Mr. T. Williams: Is it not the case that in the deficiency payments system for fat cattle there is no such thing as a guaranteed price?

Mr. Amory: I should have liked to have incorporated into my reply an expression of welcome to the right hon. Gentleman the Member for Don Valley (Mr. T. Williams) on his return to the House. I am afraid that in this case I find it rather difficult to make that relevant to the Question.
As the right hon. Gentleman knows, the present arrangement represents a collective guarantee payable to the industry as a whole. We made it clear in the last White Paper that the payment actually received by producers would not necessarily represent over a given twelve months exactly the guaranteed sum. It might be a little more or a little less. In


some cases it has proved already, in the last year or two, to have worked out at an over-payment.

Mr. Baldwin: Does my right hon. Friend not agree that to give more stability to future prices, instead of using this rolling average which many of us look upon as fatuous, he should use the deficiency payments in the same way as he deals with wheat?

Mr. Amory: There are real differences between providing for a commodity like wheat and a perishable commodity like livestock, as my hon. Friend will be well aware.

Wheat (Deficiency Payments)

Mr. Dye: asked the Minister of Agriculture, Fisheries and Food the amount of deficiency payments made to wheat growers in each of the accounting periods so far for the 1955 wheat crop; and what is the latest average market price for home-grown wheat.

Mr. Amory: As the answer contains a number of figures, I will, with permission, circulate it in the OFFICIAL REPORT.

Mr. Dye: Will those figures reveal the fact that the longer the farmer keeps his wheat on the farm the less is the amount of subsidy he receives, and that those who dump it on the market immediately after harvest get the biggest subsidy?

Mr. Amory: No, I do not think so. I think I can say that the marketing of the wheat crop over the past twelve months has proceeded very smoothly indeed and in a way favourable to the producer and to the user.

Following is the reply:

Deficiency payments made up to 23rd June in respect of the four accounting periods from 1st July, 1955, to 30th April, 1956, are as follows:

£


Period 1–1st July-30th September 1955
4,360,050


Period 2–1st October-30th November, 1955
4,379,266


Period 3–1st December, 1955–29th February, 1956
4,653,239


Period 4–1st March-30th April, 1956
2,628,008



16,020,563

The average market price for home grown wheat for the week ended 16th June, as ascertained under the Corn Returns Act, 1882, was 27s. 7d. per cwt.

Price Increases

Mr. Lewis: asked the Minister of Agriculture, Fisheries and Food whether he will give an assurance that he will take such action as may be deemed necessary to ensure that there will be no price increase during the next six months in the goods and services and articles coming within the control of his Department so as to assist in curbing the inflationary spiral.

Mr. Amory: I have nothing to add to the reply given to the hon. Member earlier this afternoon by my right hon. Friend the Minister of Supply.

Mr. Lewis: What a terrible answer! Is the Minister aware that one of the reasons for the inflationary spiral is the number of wage applications that have to be made to try to pay for the increased cost of food, which has been his responsibility? Can we have an assurance that the price of food will not be increased by his action, particularly in the case of bread, which it is rumoured will cost anything from 10d. to 1s. a loaf in September? Can he assure the House that there will be no increase in the price of food?

Mr. Amory: The assurance that I can give is that our dominating consideration in these matters is what action will conduce most effectively to curing inflation.

Hon. Members: A dodge.

Forestry (Protective Belts)

Mr. Speir: asked the Minister of Agriculture, Fisheries and Food what arrangements the Forestry Commission are now prepared to make for either burning a belt of heather themselves on neighbouring land alongside the boundaries of their plantations or to assist the occupiers of such land with burning operations.

Mr. Amory: The Forestry Commission is prepared either to burn protective belts on land adjoining plantations, or to help its neighbours to do so, wherever the risk to the Commission's plantations is high. Normally burning under this arrangement would be limited to a strip 30 yards wide, but where wider burning is essential this would be undertaken.

Mr. Speir: Is my right hon. Friend aware that, in spite of the more helpful attitude which the Forestry Commission


is now adopting, there is still very great concern among sheep farmers? Will he bear this concern in mind and ask the Commission to see whether further arrangements cannot be made?

Mr. Amory: I note what my hon. Friend has said. I hope that this attitude of the Forestry Commission will be generally regarded by neighbouring farmers as reasonable and helpful. If there are other suggestions which my hon. Friend can make, I shall be very glad to consider them.

Strychnine (Purchase)

Mr. Speir: asked the Minister of Agriculture, Fisheries and Food whether he is satisfied that sufficient steps are being taken to restrict the sale of strychnine for legitimate agricultural purposes; and whether he will consider introducing further safeguards against its misuse.

Mr. Amory: I am looking into the arrangements for authorising the purchase of strychnine for destroying moles to see whether further safeguards are desirable.

Mr. Speir: Would it not be as well to limit the amount to 2 oz. to any one applicant, and will my right hon. Friend not consider whether it is not desirable for applications to go before a special sub-committee instead of being dealt with by one officer of an agricultural committee?

Mr. Amory: I will take note of both those practical suggestions by my hon. Friend. I understand that the usual amount issued is very much less than the amount he has mentioned.

Flour Confectionery

Mrs. Mann: asked the Minister of Agriculture, Fisheries and Food what representations have been made to him regarding increased prices for flour confectionery; and whether he will take steps, now, to stabilise the price, size and weight of tea bread, scones, rolls, and all flour confectionery.

Mr. Amory: I have received no representations about flour confectionery prices, and I am satisfied that in this industry competition is the best safeguard for the housewife. It is impracticable to control the size and weight of flour confectionery.

Mrs. Mann: Has the Minister not observed on his shopping expeditions that prices have gone up 25 per cent. and that in other cases the weight has gone down? Is not the latter in itself a concealed price increase? Is he not aware that the evidence is all contained in the Report of the Hodgson Committee?

Mr. Amory: I have noticed on my shopping expeditions that there seems to be a good deal of evidence of intense competition in this field. I would remind the hon. Lady that in wartime, when control was imposed on flour confectionery, it was found that, owing to the difficulty of effecting standardisation, the control was very cumbersome and difficult to enforce. It would be a great deal more so now.

Mrs. Mann: asked the Minister of Agriculture, Fisheries and Food to what extent proposed alterations in price and quality of bread will affect flour confectionery, including scones, rolls, teabread, and cakes.

Mr. Amory: There is no reason why the price or quality of flour confectionery should be affected by the decontrol of bread in September.

Mrs. Mann: Is the Minister aware that I do not consider that to be an adequate reply at all? Is he aware that I am asking for an assurance that there will not be increases due to the withdrawal of subsidy? Is the right hon. Gentleman going to rely entirely on competition? Is he aware that he is selling the plateau of stability down the river, like Trinidad oil?

Mr. Amory: I cannot agree with the hon. Lady. I am going to rely in this field on the forces of competition.

Foxes

Mr. Hayman: asked the Minister of Agriculture, Fisheries and Food why the bonus paid to employees of the National Forestry Commission for fox brushes has been withdrawn; and why they have been instructed not to kill foxes.

Mr. Amory: The bonus has been withdrawn in some areas where it is agreed that foxes can be effectively kept down by the local hunt.

Mr. Hayman: May I ask the Minister for an assurance that his Ministry will not preserve foxes for fox hunting?

Mr. Amory: I think the hon. Member will agree that in many parts of the country fox hunting is quite an efficient way of keeping down the foxes, though I would add that in the days when I was a master of foxhounds I found them uncommonly difficult to catch.

Sir H. Studholme: Is my right hon. Friend aware that in the South Tetcott country, which is in my constituency, where such an arrangement has been arrived at, nearly all the farmers who support the hunt appear to be quite satisfied?

Mr. Amory: I hope that my hon. Friend will invite me down to satisfy myself in person that this is happening and that the foxes are being caught.

Wissington Light Railway

Mr. Dye: asked the Minister of Agriculture, Fisheries and Food if he will make a statement on the future of the Wissington light railway.

Mr. Amory: Yes, Sir. This light railway with 18 miles of line was first requisitioned and later bought after the war by the Minister of Agriculture. It has been administered by my Department on a temporary basis, but I can no longer justify this arrangement. The National Farmers' Union, which is representing the interests of the growers concerned, has been told that this arrangement must end in a year's time. A meeting has been arranged with growers and they will be given the first opportunity to take over the Ministry's interest.

Mr. Dye: But why has the Minister offered the line to local farmers? Why has he not offered it to British Railways, without which it cannot run? If British Railways are not prepared to take it, why, in view of the fact that this railway has been making a profit, does he not ask the Wissington light railway to take over British Railways?

Mr. Amory: I will gladly offer the hon. Member the chance of coming in on the ground floor on this occasion.

White Fish Subsidy Scheme

Mr. Willey: asked the Minister of Agriculture, Fisheries and Food whether he will now state on what date the new White Fish Subsidy Scheme will be laid before the House.

Mr. Amory: As early as possible next month, though I cannot as yet give a precise date.

Mr. Willey: In view of what happened last time, when the right hon. Gentleman's blunder was ameliorated in the light of Parliamentary criticism, will the right hon. Gentleman assure the House that there will be an opportunity to discuss this Scheme fully before the Recess?

Mr. Amory: I will give the hon. Member that assurance.

Food and Agriculture Organisation (Director-General)

Mr. Willey: asked the Minister of Agriculture, Fisheries and Food whether he will make a statement on the action being taken by Her Majesty's Government regarding the Director-General of the Food and Agriculture Organisation.

Mr. Amory: It was decided on Monday last that a Special Conference should proceed in September to the appointment of a new Director-General. All the probable candidates are not yet known. Her Majesty's Government will be guided by its determination to support the Organisation in its constructive work.

Mr. Wiley: But will the right hon. Gentleman give the lie to the Beaver-brook Press about the acting Director-General, who has a very distinguished record of service? Will the right hon. Gentleman make a real effort to restore our good name in this vitally important organisation?

Mr. Amory: Of all the possible candidates within the Organisation, I cannot think of any one with better claims than Sir Herbert Broadley, who has not only rendered distinguished services to my Department during the war but also very distinguished services to the Food and Agriculture Organisation as Deputy Director-General.

Oral Answers to Questions — HOSPITALS

Elderly Chronic Sick

Mr. J. Johnson: asked the Minister of Health how many hospitals in England and Wales have been allowed to build increased accommodation for the elderly chronic sick; and if he will itemise the


particular schemes of this nature for which he has granted permission to the Birmingham Regional Hospital Board.

The Parliamentary Secretary to the Ministry of Health (Miss Patricia Hornsby-Smith): Increased accommodation for the elderly chronic sick has been provided or approved at 202 hospitals, often by the adaptation or transfer of other accommodation. I will, with permission, circulate in the OFFICIAL REPORT particulars of schemes for which approval has been given to the Birmingham Regional Hospital Board.

Mr. Johnson: While thanking the hon. Lady for that answer, may I ask whether she can tell me now when the extensions of St. Luke's Hospital at Rugby are likely to be undertaken? If there is difficulty in building wings to existing accommodation, would the hon. Lady consider allowing hospitals to buy houses nearby? The old people would like that. They prefer to be in an integrated society rather than to be segregated in institutional buildings.

Miss Hornsby-Smith: If the hon. Member will put a Question on the Order Paper, I will give a detailed answer with regard to the hospital he mentioned. As for buying houses, there is the difficulty that many of the houses are of two or three floors, while for elderly people we have to provide the maximum accommodation on the ground floor.

Dr. Summerskill: As the demand for this kind of accommodation is greater than that for any other kind, would the hon. Lady and her right hon. Friend, when these Questions are asked, come to the Dispatch Box with as much detail as possible, because I think that all hon. Members are interested in the answer?

Miss Hornsby-Smith: indicated assent.

Following are the particulars of schemes:
Schemes for which approval has been given to provide additional accommodation for the elderly sick in the Birmingham region.
Bromyard Hospital. Geriatric unit of 35 beds.
Andressey Hospital, Burton-on-Trent. Geriatric unit of 46 beds.
In addition the Regional Board have, since 1950, provided 240 chronic sick beds by the re-allocation of accommodation used for other purposes at the following hospitals:—Bucknall Hospital, Stoke-on-Trent; Greenfields Hospital, Oswestry; Cheadle Hospital Annexe;

Newcastle-under-Lyme Isolation Hospital; White Lodge, Cannock; and Taylor Memorial Home of Rest, Erdington; and by the re-arrangement of accommodation at Morda House, Oswestry and Stone House, Bishop's Castle which are non-transferred local authority institutions partly used for hospital purposes.

Shipley Common Site, Ilkeston

Mr. Oliver: asked the Minister of Health the reasons for his refusal to waive his objections to the purchase by the Sheffield Regional Hospital Board of the Shipley Common site for hospital development at Ilkeston.

Miss Hornsby-Smith: My right hon. Friend considers that this site is unsuitable owing to danger of subsidence due to coal mining.

Mr. Oliver: By implication, does not that answer mean that no hospital will be built either in Ilkeston or in any of the surrounding towns until all the coal has been extracted, which will be many years from now, and is not that a most alarming statement to make? Further, may I ask whether the hon. Lady or her right hon. Friend would be good enough to discuss this matter with the many industries interested, because it is a highly industrialised area to which this answer will give complete consternation?

Miss Hornsby-Smith: I appreciate the difficulties of the hon. Gentleman in this matter, but we have received technical advice that the seams of coal under this site may be worked between 1960 and 1980. Obviously, therefore, it is not practicable to go ahead with a large building like a hospital, which would immediately suffer from any subsidence at the site. In fact, we have been advised that in order to prevent mining under the site it would be necessary to buy a supporting pillar of coal at a cost of £250,000, which obviously is not a practical proposition.

Bread Contracts (Prices)

Mr. E. Johnson: asked the Minister of Health if he is aware that bakers supplying bread to hospitals on contracts not containing a rise or fall clause have been seriously affected by his decision that hospital management committees should not pay them the increased price of bread resulting from the reduction of the bread subsidy; and


if, in view of the fact that this increase came about as the result of a Government decision and was a matter over which the bakers had no control, he will allow hospital management committees to pay the increased price.

The Minister of Health (Mr. R. H. Turton): I am aware of representations to this effect. I am advised and have informed hospital authorities that unless provision for variation of price is included in the contract there is no legal liability to pay more than the contract price. It would therefore be improper for me to authorise extra-contractual payments.

Mr. Johnson: Is my right hon. Friend aware that hospital management committees would like to pay the extra price in view of the fact that, when the price of bread was reduced, bakers in turn reduced their prices even if their contracts did not contain a rise and fall clause? Is it not rather mean to stick too rigidly to the letter of the law?

Mr. Turton: I am not aware that bakers have reduced their prices in such circumstances. When there is a price change, and if there is a clause of this nature, the contractor gains on some occasions and loses on others. It must also be remembered that hospital management committees will have accepted tenders in competition with other tenderers, and it would be wrong to go back on them at this stage.

Hospital Staff (Prescription Charges)

Mr. K. Robinson: asked the Minister of Health whether hospital staff who require medicaments as a result of accidents sustained in the course of their work are liable, under his regulations, to pay prescription charges to the dispensary of the hospital concerned.

Miss Hornsby-Smith: No charge is payable for immediate treatment of an injury, but otherwise hospital employees, like other persons, are liable to pay this charge for drugs supplied from hospital out-patient departments.

Mr. Robinson: Is the hon. Lady aware that a member of a teaching hospital staff recently, who cut himself with a scalpel in the course of his duties, was charged a prescription charge by his own hospital

dispensary for an anti-tetanus injection, and is not this a ridiculous procedure and will the hon. Lady undertake to see that it stops?

Miss Hornsby-Smith: I think that the example given by the hon. Gentleman is a rare one. I should have thought it qualified for immediate treatment as a casualty and I am surprised that the hon. Gentleman has had to bring it to our notice. If he likes to give me the details, I shall be happy to look into them.

Mr. J. Griffiths: Will the Minister ensure that in cases of accidents treatment is given free of cost, as was envisaged in the Industrial Injuries Act?

Miss Hornsby-Smith: That is another question. I shall be pleased to look into it if the right hon. Gentleman will kindly put down a Question.

Regional Boards (Capital Development Schemes)

Mr. K. Robinson: asked the Minister of Health if he is now in a position to adopt the recommendation of the Guillebaud Committee that regional boards should not be required to submit capital development schemes of less than £50,000 for prior approval by his Department.

Mr. Turton: This is still under consideration.

Mr. Robinson: The right hon. Gentleman has had this matter under consideration for six months, and does he not agree that it is desirable for regional hospital boards to have control of their own budget with the minimum of interference from his Department, and would he expedite a favourable reply to this matter?

Mr. Turton: The hon. Gentleman put down a similar question to the Chancellor on 19th June and received a similar reply. This is bound up with certain other recommendations of the Guillebaud Committee.

Dr. Summerskill: Could the right hon. Gentleman tell us which of the recommendations of the Guillebaud Committee he is prepared to accept?

Mr. Turton: I would refer the hon. Lady to the reply I gave to the House on 25th January, which set that out in considerable detail.

Mr. Peyton: Would my right hon. Friend press upon the Treasury the views of the regional hospital boards on this matter, namely, that it is desirable that these responsible boards should be given the maximum of freedom with which to conduct their difficult task?

Mr. Turton: I am aware of the views expressed by my hon. Friend.

Site, St. Austell

Mr. Hayman: asked the Minister of Health what difficulties are delaying the acquisition of a site, and the consequent provision of plans, for the proposed new district hospital at St. Austell.

Mr. Turton: I would refer the hon. Member to my reply on 18th June to a Question by my hon. Friend the Member for Truro (Mr. G. Wilson).

Mr. Hayman: Can the Minister say whether property owners are causing obstruction to the acquisition of the site? If so, will he say what he is doing about it?

Mr. Turton: No, Sir; I do not know that. All I know is that the Minister of Housing and Local Government has the matter of the site still under consideration.

Mr. G. Wilson: Is my right hon. Friend aware that, following his answer to my Question last week relating to this hospital in my division, I have a Question on the Order Paper tomorrow dealing with the matter?

Mr. Hayman: asked the Minister of Health what is the amount of the trust funds available for the first instalment of the proposed new district hospital at St. Austell, Cornwall; when he expects building operations to commence; whether further instalments will be financed out of funds available to the regional hospital board; when he expects the hospital to be completed; and what accommodation will then be available.

Mr. Turton: The regional hospital board hold a trust fund of about £90,000 and this sum will be increased if the West Cornwall Hospital Management Committee agree to use a bequest which they hold. Until the site is settled the Board cannot make progress with their plans, which will have to be discussed with my Department before a final decision is

reached. I therefore cannot give any forecast of progress at this stage.

Mr. Hayman: Is the Minister aware that the people of Cornwall are very upset at the continued delay in the provision of this much-needed hospital, and will he do what he can to accelerate its provision?

Mr. Turton: I feel sure that the people of Cornwall recognise that we are at present going forward with the building of a hospital at Truro and also have this project under active consideration.

Oral Answers to Questions — MINISTRY OF HEALTH

Mass Radiography

Dr. Stross: asked the Minister of Health (1) whether he will make a statement on the policy he intends to follow with reference to mass X-ray of the population and, in particular, for middle-aged groups and new entrants to industry;
(2) whether he has noted the value of mass X-ray, not only in the detection of tuberculosis, but in pneumoconiosis among the general population; and whether he will replace the present 30-millimetre type of machine by the more modern 100 millimetre.

Mr. Turton: The number of mass miniature radiography units has increased from 36 in 1948 to 75 at the present time, and the number of examinations, which are on a voluntary basis, has increased threefold. Voluntary surveys will be continued, and persons of middle age and new entrants to industry are being encouraged to use these facilities if they have not recently had a chest X-ray. Six 100-millimetre cameras are being purchased for installing, on an experimental basis, at six hospital out patient departments.

Dr. Stross: I thank the right hon. Gentleman for that reply, but is he aware that in some areas at least the examination of some sections of the population, such as miners, might well be more fruitful and useful if the 100-millimetre camera were used and, in the long run, perhaps more economical? Would he bear that in mind?

Mr. Turton: Certainly, Sir. I am anxious to undertake this experiment of


the 100-millimetre camera. Some are already working; in fact nine hospitals are using them, but not on a large-scale basis for this purpose. I hope very much that one of the hospitals chosen for the 100-millimetre camera will be in the Midlands.

Local Authority Projects

Mr. Gibson: asked the Minister of Health how many projects for capital expenditure put forward by local health authorities have been refused consent, or a starting date denied during the year ending April, 1956; and what is the total amount of capital involved in these decisions.

Miss Hornsby-Smith: Thirty projects at a total estimated cost of £340,000.

Mr. Gibson: Can the Minister tell me how many maternity and health centres are affected as a result of the figure which she has just given?

Miss Hornsby-Smith: Not without notice, but if the hon. Gentleman likes to put down a Question I shall be only too pleased to annotate the types of building affected.

Dr. Summerskill: In view of the fact that the Minister of Health showed sympathy with the Guillebaud Report, the chief recommendation of which was to provide capital expenditure for hospitals, can the hon. Lady say why this attitude is adopted at this stage?

Miss Hornsby-Smith: The Guillebaud Committee repeatedly laid down the principle that, whilst many items might be desirable, they would have to conform to the general economic circumstances of the country, and that is the principle we are following here.

Disabled Persons (Motor Cars)

Mr. Collins: asked the Minister of Health how many of the cars supplied to disabled persons have been replaced with new cars; and if he will review his policy on this subject with the object of ensuring greater uniformity of treatment.

Mr. Turton: None, Sir. The second part of the Question therefore does not arise.

Mr. Collins: But is the right hon. Gentleman aware that it is twelve months

since his predecessor announced his policy on the replacement of cars for the disabled and told us that replacement would then commence? Is he further aware that many of the disabled people running nine-year-old cars find the running and repair costs uneconomic at a time when they are more dependent than ever on the cars for mobility? Will he do something to alter the policy so that the cars can be replaced?

Mr. Turton: I think the hon. Gentleman is under a misapprehension. My right hon. Friend said on 5th December that he would not expect replacement to be necessary until a car had been used for at least eight years. In fact, none of the cars has been on issue for eight years, as the earliest was issued towards the end of 1948. I am looking into the question of how replacements should be conducted when it becomes necessary, and the main factor is whether a car can be economically repaired.

Mr. Blenkinsop: Is the Minister aware that there is a good deal of evidence of the expense of repairs of the old vehicles, both old tricycles and some cars, and would he give the matter very careful consideration?

Mr. Turton: Yes, Sir, I am aware of that fact and I am giving it consideration, but there is no lack of uniformity of treatment.

Care of Children

Mr. Hastings: asked the Minister of Health whether in view of the number of parents who abandon their children or leave them unnecessarily in the care of local authorities, he will publish a short leaflet to be given to the parents of all children when their birth is registered pointing out the incalculable value of the love and security that they can provide for their offspring.

Miss Hornsby-Smith: No, Sir. My right hon. Friend does not consider that this would be an effective way of dealing with the problem of the neglectful parent.

Mr. Hastings: Does the hon. Lady realise how important parental control of children is? Does she realise that much delinquency, mental disease and other troubles can be prevented by it, and yet parents do not appreciate this? Can


something be done to ensure that parents realise the importance of parental control?

Miss Hornsby-Smith: I sympathise very much with the hon. Gentleman's desires in this matter, but, having regard to what is done by the vast majority of good parents, I do not think it would be advisable to circulate all parents on how to bring up their children, which I think would cause a great deal of resentment.
I think that the maternity and child welfare clinics provide adequate skilled knowledge and guidance to help any parents who might benefit from it. In the fifteen months from December, 1954, to March, 1956, 300 children were taken into the care of local authorities compared with 1,300 in the previous twelve months. This is a great tribute to the work done in the clinics.

Health Visitors (Report)

Mr. Janner: asked the Minister of Health what action he proposes to take following the recommendations of the Working Party on Health Visiting.

Mr. Turton: I shall be consulting the organisations principally concerned when they have had time to consider this very full Report.

Mr. Janner: As the Report is the result of three years' very careful study on the part of the Committee, and as the Committee has stated that 3,500 full-time workers are needed to provide a reasonable service, will he hurry the matter up and ensure that something is done?

Mr. Turton: Because it has taken such a long time to prepare the Report, I feel sure that the Committee would expect me to give due consideration to it and have full consultations with the bodies concerned, especially in respect of the recommendations relating to the training system for health visitors.

Mr. Blenkinsop: Would not the right hon. Gentleman at least agree that he would wish to see much greater co-operation between general practitioners and health visitors, which is lacking in many cases at the moment?

Mr. Turton: I entirely agree. Many of the recommendations in the Report will be very valuable from that aspect.

Chronic Bronchitis

Mr. Collins: asked the Minister of Health whether he has now received specific advice from the Medical Research Council on the prevention and cure of chronic bronchitis; and if he will make a statement.

Mr. Turton: I have nothing yet to add to the reply I gave to the hon. Member for Huddersfield West (Mr. Wade) on 30th January.

Mr. Collins: That was nearly six months ago. When will the right hon. Gentleman announce what plans he has for making special efforts to deal with the increasing toll of bronchial complaints? Will he consider using some of the empty beds no longer required for T.B. patients to prepare for the unquestioned increase in difficulties which will come from bronchitis patients in the winter?

Mr. Turton: This Question and the one on 30th January dealt particularly with research. The Medical Research Council is conducting research into this matter. It is optimistic to expect quick and early results from such research, but research is proceeding and is also being undertaken by regional hospital boards.

HOUSE OF COMMONS CATERING

Mr. Hale: asked the hon. Member for Woolwich, West, as Chairman of the Kitchen Committee, to what extent the agreement entered into with the staff of the Dining Rooms and Smoke Room whereby in exchange for guaranteed employment throughout the year they surrendered the privilege of receiving gratuities is still in force.

Sir William Steward: The agreement governing pay and conditions of service of the staff states that wages will be calculated on the basis of current rates in force under the Catering Wages Act, plus an amount in lieu of tips for those categories of staff who would normally receive tips, and provides for payment of staff during Recess periods. It has been approved by official representatives of the staff and is still in force.

Mr. Hale: asked the hon. Member for Woolwich, West, as Chairman of the Kitchen Committee, the minimum wage


being paid to an adult employee in the Members' Dining Room or Kitchen for a normal working week.

Sir W. Steward: The minimum wage varies according to the job, that is, from £5 15s. to £7 15s., plus food while on duty; plus free uniform in the case of permanent waiting staff. These minimum rates are, in all cases, above those currently in force under the Catering Wages Act.

Mr. Hale: The hon. Member is surely aware that, under the Catering Wages Act, the circumstances are not normally comparable and that £5 15s. per week for an adult employee, even with a limited amount of food, seems an appallingly low wage for the House of Commons to be paying?

Sir W. Steward: That low rate is applicable to a kitchen porter, who comes one day and may be gone the next. [Interruption.] I am just stating what the rate is. It is still in excess of the rates under the Catering Wages Act.

Mr. George Craddock: Are the rates which have been given the result of negotiations with trade unions?

Sir W. Steward: No, Sir. They are the result of negotiations between the accredited representatives of the staff and the Sub-Committee of the Kitchen Committee which deals exclusively with any complaint from the staff.

Mr. W. Edwards: The hon. Gentleman talks about negotiations between the staff side and the Kitchen Committee. Is the staff allowed to place proposals before the Sub-Committee, or are members of the staff just informed of what the Sub-Committee decides?

Sir W. Steward: Most definitely, the present wages agreement was the result of many meetings spread over many months—[HON. MEMBERS: "With whom?"]—and in no case was the staff told what it was to have. The rates were agreed. I would add that, since the agreement was entered into in 1953—it was modified in 1955—we have had no approach from any member of the staff for any change in its terms.

Mr. Hale: Is the hon. Gentleman aware that kitchen porters do enter into the bonds of matrimony and do beget children, and that £5 15s. per week is

still a shockingly low wage? Why is there not a union involved in this? Why has not the union been approached?

Sir W. Steward: There is strong trade union representation on the Committee. I take it from both sides, and these matters are thrashed out. I shall be only too pleased to submit to my Committee at its next meeting the observations of the hon. Member.

Mr. Hale: asked the hon. Member for Woolwich, West, as Chairman of the Kitchen Committee, the number of staff employed by the Kitchen Committee; and the number who have been employed there and have left their employment during the period since January, 1952.

Sir W. Steward: One hundred and twenty-one permanent full-time staff are employed at the present time. In addition, there are 55 part-time staff and up to 20 casual staff according to current needs. Since January, 1952, 458 permanent staff have resigned or been dismissed, 279 of these being kitchen porters or platemen.

Mr. Hale: Might there not be some connection between those figures and the answer which the hon. Gentleman gave to my previous Question?

Sir W. Steward: The hon. Member is at liberty to draw his own conclusions. I would remind him that, between 1947 and 1951, more than 445 members of the staff were dismissed or resigned. I would also point out to the hon. Member that, if he knows anything about the catering industry today, he will know that the great difficulty is porters. They commence on the Monday and go on the Tuesday. They are a floating population. It is very difficult to get good porters to stay in any employment.

AIRCRAFT ACCIDENT, KANO

Mr. Burden: (by Private Notice) asked the Minister of Transport and Civil Aviation if he will make a statement concerning the loss of the Argonaut aircraft of B.O.A.C. which crashed yesterday just after take-off from Kano.

The Minister of Transport and Civil Aviation (Mr. Harold Watkinson): As the House will know, an Argonaut airliner of British Overseas Airways Corporation


was lost yesterday afternoon near Kano Airport, Northern Nigeria. The aircraft crashed shortly after take-off about two miles South-West of the main runway. I regret to inform the House that of the 45 people on board, 30 lost their lives. Several of the suvivors are injured. A senior inspector and a senior investigating officer from my Ministry left this morning for the scene of the accident. I am sure the whole House will join with me in expressing sympathy with the friends and relatives of those who lost their lives and with the injured.

Mr. Burden: While thanking the Minister for that statement, may I say that I am sure that all hon. Members will wish to be associated with his remarks about the loss of this aircraft? In view of the fact that it is usual for an investigation into the loss of an aircraft to take place in the country of occurrence and the probability that there will be great difficulty in finding the necessarily qualified persons in Nigeria to undertake such an investigation, will my right hon. Friend give an undertaking that the facilities which are available to his Department will be placed freely at the disposal of the Nigerian Government?

Mr. Watkinson: Certainly. The services of any officer of my Department will be freely available for that purpose.

Mr. J. Griffiths: May I say that we on this side of the House join with the right hon. Gentleman in expressing deep sym-

pathy to those who have suffered loss in this terrible accident?

Mr. Beswick: On a point of order. It will be within the recollection of many hon. Members that they have attempted to put a Question of which they have given Private Notice but they have been disappointed because it has been held that there is no urgency about the matter, or that no national interest will be served. May I ask on what grounds there is permitted this practice under which Questions are automatically put when there is an aircraft accident?
While everyone would wish to express sympathy with the relatives of those who have lost their lives, and while we all wish to make absolutely certain that there is proper inquiry into these accidents, it seems that no useful purpose is served by asking Questions of this kind with their attendant publicity, provided that we can be satisfied that the proper procedure is being followed, as it usually is. It seems to me that matters of urgency or national interest do not arise.

Sir T. Moore: Further to that point of order. Is it not right and suitable that the relatives of those who have lost their lives should be aware of the sympathy of the House as soon as possible?

Mr. Speaker: I have to take many things into consideration in deciding whether or not to permit a Private Notice Question. I decided that, on its merits, this was a subject worthy of a Private Notice Question. That is all I can say on the matter.

Orders of the Day — FINANCE (No. 2) BILL

Considered in Committee [Progress, 19th June].

[Sir CHARLES MACANDREW in the Chair]

New Clause.—(EXEMPTION FROM EXCISE DUTY OF SCOTTISH SHALE OIL.)

(1) On and after the sixth day of August, nineteen hundred and fifty-six, hydrocarbon oil produced from shale mined in Scotland shall be exempted from excise duty; and accordingly on and after that date Section two of the Finance Act, 1950 (which imposes a duty on hydrocarbon oils) shall have effect with the addition at the end of subsection (2) of that section of the following words, that is to say, "or

"(c) to oils produced from shale mined in Scotland".

(2) The power of the Commissioners of Customs and Excise to make regulations under Section one hundred and ninety-eight of the Customs and Excise Act, 1952 (which empowers those Commissioners to make regulations relating to hydrocarbon oils) shall include power to make such regulations as appear to the Commissioners to be required to give effect to the last foregoing subsection.

(3) Where excise duty has been charged before or after the passing of this Act and by virtue of this section no such duty should have been charged, or the duty should have been charged at the lower rate than that at which it was in fact charged, the person by whom the duty was paid shall be entitled to repayment of the amount of the overcharge.—[Mr. J. Taylor.]

Brought up, and read the First time.

Motion made, and Question put, That the Clause be read a Second time:—

The Committee divided: Ayes 175, Noes 240.

Division No. 229.]
AYES
[3.35 p.m.


Albu, A. H.
Greenwood, Anthony
McInnes, J.


Allaun, Frank (Salford, E.)
Grey, C. F.
McKay, John (Wallsend)


Allen, Arthur (Bosworth)
Griffiths, David (Rother Valley)
McLeavy, Frank


Allen, Scholefield (Crewe)
Griffiths, Rt. Hon. James (Llanelly)
Mahon, Simon


Anderson, Frank
Griffiths, William (Exchange)
Mallalieu, J. P. W. (Huddersfd, E)


Bacon, Miss Alice
Grimond, J.
Mann, Mrs. Jean


Benson, G.
Hale, Leslie
Marquand, Rt. Hon. H. A.


Beswick, F.
Hall, R. Hn. Glenvil (Colne Valley)
Mason, Roy


Blackburn, F.
Hamilton, W. W.
Mayhew, C. P.


Blenkinsop, A.
Hannan, W.
Mikardo, Ian


Blyton, W. R.
Harrison, J. (Nottingham, N.)
Mitchison, G. R.


Boardman, H.
Hastings, S.
Monslow, W.


Bowden, H. W. (Leicester, S.W.)
Hayman, F. H.
Moody, A. S.


Bowles, F. G.
Healey, Denis
Morrison, Rt. Hn. Herbert (Lewis'm, S.)


Boyd, T. C.
Henderson, Rt. Hn. A. (Rwly Regis)
Moyle, A.


Braddock, Mrs. Elizabeth
Herbison, Miss M.
Neal, Harold (Bolsover)


Brockway, A. F.
Hewitson, Capt. M.
Noel-Baker, Rt. Hon. P. (Derby, S.)


Brown, Rt. Hon. George (Belper)
Hobson, C. R.
Oliver, G. H.


Brown, Thomas (Ince)
Holman, P.
Oram, A. E.


Butler, Herbert (Hackney, C.)
Holmes, Horace
Orbach, M.


Butler, Mrs. Joyce (Wood Green)
Holt, A. F.
Oswald, T.


Callaghan, L. J.
Howell, Charles (Perry Barr)
Owen, W. J.


Chapman, W. D.
Hubbard, T. F.
Paling, Will T. (Dewsbury)


Chetwynd, G. R.
Hughes, Cledwyn (Anglesey)
Palmer, A. M. F.


Clunie, J.
Hughes, Emrys (S. Ayrshire)
Parkin, B. T.


Collick, P. H. (Birkenhead)
Hunter, A. E.
Paton, John


Collins, V. J.(Shoreditch &amp; Finsbury)
Irving, S. (Dartford)
Peart, T. F.


Cove, W. G.
Isaacs, Rt, Hon. G. A.
Probert, A. R.


Craddock, George (Bradford, S.)
Janner, B.
Pryde, D. J.


Crossman, R. H. S.
Jay, Rt. Hon. D. P. T.
Randall, H. E.


Darling, George (Hillsborough)
Jeger, George (Goole)
Rankin, John


Davies, Rt. Hon. Clement (Montgomery)
Jeger, Mrs. Lena (Holbn &amp; St.Pncs, S.)
Redhead, E. C.


Davies, Ernest (Enfield, E.)
Jenkins, Roy (Stechford)
Reeves, J.


Deer, G.
Johnson, James (Rugby)
Reid, William


de Freitas, Geoffrey
Johnston, Douglas (Paisley)
Robens, Rt. Hon. A.


Delargy, H. J.
Jones, Rt. Hon. A. Creech (Wakefield)
Roberts, Albert (Normanton)


Dodds, N. N.
Jones, David (The Hartlepools)
Roberts, Goronwy (Caernarvon)


Donnelly, D. L.
Jones, Elwyn (W. Ham. S.)
Robinson, Kenneth (St. Pancras, N.)


Dugdale, Rt. Hn. John (W. Brmwch)
Jones, J. Idwal (Wrexham)
Ross, William


Dye, S.
Jones, T. W. (Merioneth)
Royle, C.


Ede, Rt. Hon. J. C.
Kenyon, C.
Short, E. W.


Edwards, Rt. Hon. John (Brighouse)
Key, Rt. Hon. C. W.
Silverman, Julius (Aston)


Edwards, Robert (Bilston)
King, Dr. H. M.
Simmons, C. J. (Brierley Hill)


Edwards, W. J. (Stepney)
Lawson, G. M.
Slater, Mrs. H. (Stoke, N.)


Evans, Albert (Islington, S. W.)
Lewis, Arthur
Slater, J (Sedgefield)


Evans, Edward (Lowestoft)
Lindgren, G. S.
Stokes, Rt. Hon. R. R. (Ipswich)


Fienburgh, W.
Lipton, Lt.-Col. M.
Stones, W. (Consett)


Fraser, Thomas (Hamilton)
Logan, D. G.
Strachey, Rt. Hon. J.


Gibson, C. W.
Mabon, Dr. J. Dickson
Strauss, Rt. Hon. George (Vauxhall)


Gordon-Walker, Rt. Hon. P. C.
McGhee, H. G.





Stross,Dr.Barnett(Stoke-on-Trent,C.)
West, D. G.
Wilson, Rt. Hon. Harold (Huyton)


Summerskill, Rt. Hon. E.
Wheeldon, W. E.
Woodburn, Rt. Hon. A.


Sylvester, G. O.
White, Henry (Derbyshire, N.E.)
Woof, R. E.


Thomson, George (Dundee, E.)
Wilkins, W. A.
Yates, V. (Ladywood)


Tomney, F.
Willey, Frederick
Younger, Rt. Hon. K.


Viant, S. P.
Williams, Rev. Llywelyn (Ab'tillery)
Zilliacus, K.


Warbey, W. N.
Williams, Rt. Hon. T. (Don Valley)



Weitzman, D.
Williams, W. R. (Openshaw)
TELLERS FOR THE AYES:


Wells, Percy (Faversham)
Williams, W. T. (Barons Court)
Mr. J. Taylor and Mr. Rogers.


Wells, William (Walsall, N.)
Willis, Eustace (Edinburgh, E.)





NOES


Aitken, W. T.
Fort, R.
Lucas, Sir Jocelyn (Portsmouth, S.)


Allan, R. A. (Paddington, S.)
Freeth, D. K.
Lucas, P. B. (Brentford &amp; Chiswick)


Alport, C. J. M.
Gammans, Sir David
Lucas-Tooth, Sir Hugh


Amery, Julian (Preston, N.)
George, J. C. (Pollok)
McAdden, S. J.


Amory, Rt. Hn. Heathcoat (Tiverton)
Gibson-Watt, D.
Macdonald, Sir Peter


Anstruther-Gray, Major Sir William
Glover, D.
McKibbin, A. J.


Arbuthnot, John
Godber, J. B.
McLaughlin, Mrs. P.


Armstrong, C. W.
Gough, C. F. H.
Maclay, Rt. Hon. John


Atkins, H. E.
Gower, H. R.
McLean, Neil (Inverness)


Baldock, Lt.-Cmdr. J. M.
Grant, W. (Woodside)
Macmillan, Rt. Hn. Harold (Bromley)


Baldwin, A. E.
Green, A.
Macpherson, Niall (Dumfries)


Balniel, Lord
Gresham Cooke, R.
Maddan, Martin


Banks, Col. C.
Grimston, Hon. John (St. Albans)
Maitland, Cdr. J.F. W. (Horncastle)


Barber, Anthony
Grimston, Sir Robert (Westbury)
Maitland, Hon. Patrick (Lanark)


Barter, John
Gurden, Harold
Manningham-Buller, Rt. Hn. Sir R.


Beamish, Maj. Tufton
Hall, John (Wycombe)
Marples, A. E.


Bell, Ronald (Bucks, S.)
Harris, Frederic (Croydon, N.W.)
Marshall, Douglas


Bennett, F. M. (Torquay)
Harrison, A. B. C. (Maldon)
Mathew, R.


Bevins, J. R. (Toxteth)
Harrison, Col. J. H. (Eye)
Maude, Angus


Biggs-Davison, J. A.
Harvey, Air Cdre. A. V. (Macclesfd)
Maudling, Rt. Hon. R.


Bishop, F. P.
Harvey, Ian (Harrow, E.)
Mawby, R. L.


Black, C. W.
Harvey, John (Walthamstow, E.)
Maydon, Lt.-Comdr. S. L. C.


Body, R. F.
Harvie-Watt, Sir George
Medlicott, Sir Frank


Boothby Sir Robert
Hay, John
Milligan, Rt. Hon. W. R.


Bossom, Sir A. C.
Heald, Rt. Hon. Sir Lionel
Molson, Rt. Hon. Hugh


Boyd-Carpenter, Rt. Hon. J. A.
Heath, Rt. Hon. E. R. G.
Moore, Sir Thomas


Boyle, Sir Edward
Henderson, John (Cathcart)
Morrison, John (Salisbury)


Braine, B. R.
Hicks-Beach, Maj. W. W.
Nabarro, G. D. N.


Braithwaite, Sir Albert (Harrow, W.)
Hill, Rt. Hon. Charles (Luton)
Nairn, D. L. S.


Bromley-Davenport, Lt.-Col. W. H.
Hill, Mrs. E. (Wythenshawe)
Nicolson, N. (B'n'm'th, E. &amp; Chr'ch)


Brooke, Rt. Hon. Henry
Hinchingbrooke, Viscount
Nield, Basil (Chester)


Brooman-White, R. C.
Hirst, Geoffrey
Nugent, G. R. H.


Browne, J. Nixon (Craigton)
Holland-Martin, C. J.
Oakshott, H. D.


Buchan-Hepburn, Rt. Hon. P. G. T.
Hope, Lord John
O'Neill, Hn. Phelim (Co. Antrim, N.)


Bullus, Wing Commander E. E.
Hornby, R. P.
Ormsby-Gore, Hon. W. D.


Butcher, Sir Herbert
Hornsby-Smith, Miss M. P.
Orr, Capt. L. P. S.


Butler,Rt.Hn.R.A.(SaffronWalden)
Horobin, Sir Ian
Osborne, C.


Campbell, Sir David
Horsbrugh, Rt. Hon. Dame Florence
Page, R. G.


Cary, Sir Robert
Howard, Hon. Greville (St. Ives)
Pannell, N. A. (Kirkdale)


Channon, H.
Howard, John (Test)
Peyton, J. W. W.


Cole, Norman
Hudson, Sir Austin (Lewisham, N.)
Pilkington, Capt. R. A.


Conant, Maj. Sir Roger
Hughes Hallett, Vice-Admiral J.
Pitt, Miss E. M.


Cooper, Sqn. Ldr. Albert
Hulbert, Sir Norman
Powell, J. Enoch


Cooper-Key, E. M.
Hutchison, Sir Ian Clark (E'b'gh,W.)
Prior-Palmer, Brig. O. L.


Cordeaux, Lt.-Col. J. K.
Hylton-Foster, Sir H. B. H.
Profumo, J. D.


Corfield, Capt. F. V.
Irvine, Bryant Godman (Rye)
Raikes, Sir Victor


Craddock, Beresford (Spelthorne)
Jennings, J. C. (Burton)
Ramsden, J. E.


Crouch, R. F.
Johnson, Dr. Donald (Carlisle)
Redmayne, M.


Crowder, Sir John (Finchley)
Johnson, Eric (Blackley)
Rees-Davies, W. R.


Crowder, Petre (Ruislip—Northwood)
Johnson, Howard (Kemptown)
Remnant, Hon. P.


Cunningham, Knox
Jones, Rt. Hon. Aubrey (Hall Green)
Renton, D. L. M.


Currie, G. B. H.
Joseph, Sir Keith
Ridsdale, J. E.


Dance, J. C. G.
Keegan, D.
Robertson, Sir David


Davidson, Viscountess
Kerby, Capt. H. B.
Robinson, Sir Roland (Blackpool, S.)


D'Avigdor-Goldsmid, Sir Henry
Kerr, H. W.
Roper, Sir Harold


Deedes, W. F.
Kimball, M.
Russell, R. S.


Digby, Simon Wingfield
Kirk, P. M.
Schofield, Lt.-Col. W.


Dodds-Parker, A. D.
Lagden, G. W.
Scott-Miller, Cmdr. R.


Donaldson, Cmdr. C. E. MacA.
Lambert, Hon. G.
Sharples, R. C.


Doughty, C. J. A.
Lancaster, Col. C. G.
Soames, Capt. C.


du Cann, E. D. L.
Langford-Holt, J. A.
Spearman, Sir Alexander


Dugdale, Rt. Hn. Sir T. (Richmond)
Leather, E. H. C.
Speir, R. M.


Duncan, Capt. J. A. L.
Leavey, J. A.
Spence, H. R. (Aberdeen, W.)


Duthie, W. S.
Legge-Bourke, Maj. E. A. H.
Spens, Rt. Hn. Sir P. (Kens'gt'n, S.)


Eden, J. B. (Bournemouth, West)
Lennox-Boyd, Rt. Hon. A. T.
Stanley, Capt. Hon. Richard


Elliot, Rt. Hon. W. E.
Lindsay, Hon. James (Devon, N.)
Stevens, Geoffrey


Emmet, Hon. Mrs. Evelyn
Lindsay, Martin (Solihull)
Steward, Harold (Stockport, S.)


Erroll, F. J.
Linstead, Sir H. N.
Steward, Sir William (Woolwich, W.)


Farey-Jones, F. W.
Lloyd, Maj. Sir Guy (Renfrew, E.)
Studholme, Sir Henry


Fell, A.
Lloyd, Rt. Hon. Selwyn (Wirral)
Summers, Sir Spencer


Finlay, Graeme
Longden, Gilbert
Taylor, Sir Charles (Eastbourne)


Fletcher-Cooke, C.
Low, Rt. Hon. A. R. W.








Taylor, William (Bradford, N.)
Vaughan-Morgan, J. K.
Whitelaw, W.S.I. (Penrith &amp; Border)


Thomas, P. J. M. (Conway)
Vickers, Miss J. H.
Williams, Paul (Sunderland, S.)


Thompson, Kenneth (Walton)
Wakefield, Edward (Derbyshire, W.)
Williams, R. Dudley (Exeter)


Thompson, Lt.-Cdr. R. (Croydon, S.)
Walker-Smith, D. C.
Wills, G. (Bridgwater)


Thornton-Kemsley, C. N.
Wall, Major Patrick
Wilson, Geoffrey (Truro)


Tilney, John (Wavertree)
Ward, Hon. George (Worcester)
Woollam, John Victor


Touche, Sir Gordon
Waterhouse, Capt. Rt. Hon. C.



Turton, Rt. Hon. R. H.
Watkinson, Rt. Hon. Harold
TELLERS FOR THE NOES:


Vane, W. M. F.
Webbe, Sir H.
Mr. Legh and Mr. Hughes-Young.

New Clause.—(CHILD ALLOWANCE.)

In subsection (1) of Section two hundred and twelve of the Income Tax Act, 1952, as amended (which relates to relief in respect of children), the amount of relief shall be increased from tax at the standard rate on one hundred pounds to tax at the standard rate on one hundred and twenty-five pounds.—([Mr. Jay.]

Brought up, and read the First time.

Mr. Douglas Jay: I beg to move, That the Clause be read a Second time.

The Chairman: I think it would be convenient to the Committee if we took, at the same time, the proposed new Clause in the name of the hon. and gallant Member for Knutsford (Lt.-Col. Bromley-Davenport) dealing with the allowance in respect of school fees.

Viscount Hinchingbrooke: On a point of order. From time to time, Sir Charles, you are good enough to make available to hon. and right hon. Members the details of those new Clauses and Amendments which are to be called and those which have been ruled out of order or will not be selected. For the last two or three years a rather agreeable and convenient custom has grown up of showing, at the Bar of the House, what Members have taken part in a debate and the nature of the business currently being taken.
I was wondering whether you would give consideration—and perhaps give your Ruling tomorrow, at the beginning of our proceedings—to the possibility of a list of future new Clauses and Amendments, marked as selected, not selected, or out of order, as the case may be—not too far ahead; perhaps for the following page of the Notice Paper, and so allowing for some flexibility—being put on the panel at the Bar in company with the other items. Many hon. and right hon. Members coming to our debates would often like to take part immediately, or make whatever arrangements they can subsequently.

The Chairman: I should be perfectly willing for a list to be displayed of new Clauses and Amendments which are out of order, because that is definite; but I should be very reluctant to have my selections put up, because I want to have a free hand to vary them from time to time. I am always willing to mark anyone's Notice Paper if he comes to me privately, but it is always subject to alteration. I should be reluctant to put up a notice showing my selections, because it might be that I should not call a new Clause or an Amendment previously selected. Anyway, it is not I who stick up notices.

Mr. Jay: The new Clause which I have moved is a simple one. It is designed to raise the ordinary child allowance for Income Tax purposes from £100 to £125. Within the field of tax relief hon. Members on this side of the Committee give very high priority to this proposal. I say "within the field of tax relief", because we should be in favour of giving help, at the same time, to other families below the Income Tax level—but it is not possible to discuss that question this afternoon.
There are two reasons why a strong case can be made out for this concession to the large family. First, it unquestionably gives relief where the need is greatest. We do not believe that all tax concessions should necessarily be confined to those with the lowest incomes, and this concession would give relief right up the scale, even including certain Surtax payers. Although the relief may legitimately be spread over a range of income in that way, we nevertheless feel that it should be concentrated where the need is greatest.
The second main argument for this greater allowance is that it would directly relieve the very substantial inequality which now exists, at any given level of nominal income before tax, between what we may call the single-earner household and the large family household, that is to say, the household with a few earners and


a number of dependants. Although we have often debated this point before, in the last few years, I am not sure whether, even now, people realise how great is the inequality of income after tax as between the family with many dependants and the family with a single earner or the couple, both earning.
To illustrate that point, I would remind the Committee that in France, for instance, Income Tax is calculated according to the number of individuals in the family. In its second Report the Royal Commission on the Taxation of Profits and Income described the French system in this way:
… in France not only are the incomes of husband and wife aggregated, but the incomes of children are included in the income of the family unit. The aggregate income is then divided into a number of parts according to the number of persons in the family and tax is charged separately on each part.
For this purpose the child is counted as one half. Were we to adopt that system, it would mean a revolutionary change, to the advantage of the family and the disadvantage of the single earner. Though I would not advocate going so far as that, it would be possible, without going so far, to go a very long way from our present system.
To illustrate that, I have tried to make a calculation—taking the income per head after tax as the measure of the standard of living in the family—of what difference there is between the single man with an all-earned income, on the one hand, and a married man with a wife and three children at the same level of income, on the other.
It is always rather remarkable to me how this sum works out. If we take either £10 a week, £20 a week—which is approximately £1,000 a year—£2,000 a year, or £5,000 a year, we get this result. On the test of income per head in the household after paying tax, the single man, or, indeed, the single women, at any of those levels of income, is between four and four-and-a-half times better off, according to my arithmetic, than a man with a wife and three children.
The implication of that is that all our tax arrangements for helping the family—including family allowances which I have included in my arithmetic—mean that the single man, instead of being five times better off, is four-and-a-quarter or four-and-one-third times better off.

Therefore, we have not made quite so much difference as some people might suppose.
If we consider the difference between the £10 a week single man and the £2,000 a year single man, again, all earned income, and take their incomes after tax, it is rather remarkable that the £2,000 a year man is only about three-and-a-third times better off on the same test. That is to say, there is a wider gap between the single man and the man with a wife and three children at either of those levels of income as there is between the £10-a-week and the £2,000-a-year single men. That, briefly, illustrates the great inequalities at all levels between large and small families.
The other fact which the public, and perhaps this Committee, has not really realised is that this gap has very much widened since before the war, as a result—I think quite an accidental result—of the way in which Income Tax was raised during the war; the way in which it was, step by step, reduced after the war, and of the rise in the cost of living over those same years.
This is well brought out in the minority Report of the Royal Commission. It is a little complicated, but I think the point just worth making. The authors of the minority Report, and this is a matter of arithmetic, say, in page 73:
Nevertheless we doubt whether, if it had not occurred as an automatic and silent consequence of the inflation, Parliament would have sanctioned some of the changes in the incidence of taxation that have, in fact, taken place—particularly as between people in different family circumstances. We doubt, for example, whether the needs of revenue could justify the fact that the married man with two children who before the war, on a pre-war income of £400 a year, paid an identical amount of tax as the single man at £150 a year and the married man with no children at £250 a year should now be asked to contribute, on the same real income, more than three times as much as the corresponding single man and one-and-a-half times as much as the married man.
It is rather complicated, but the essential point is that, as a result of the rise in the cost of living, the gap between the two types of families has widened very considerably since before the war. The minority Report is right in saying that at no time has Parliament, or any Chancellor, deliberately decided that there should be this shift in the burden away from the bachelor or single earner over that period.
It is relevant to point out that the Commission's Report was published in 1954, and that since 1954 the cost of living, has, of course, risen very considerably, by about 2s. or 2s. 6d. in the £. The Financial Secretary may, quite legitimately, point out that since the Commission reported the Government—very properly, as we think—have raised the child allowance from £85, at which figure it then stood, to £100, which is the present figure, and we are proposing that it should be extended further. If the right hon. Gentleman says that, I ask him to bear in mind that there has been a substantial rise in the cost of living since the Commission reported two years ago.
In our view, this concession would go a long way to meet some of the legitimate complaints, not merely of those with low incomes and large families, but, also, some of those with middle and professional incomes. We hear a great deal of lamentation from hon. Members opposite, and there is a good deal in the Press, about the sad plight of what some hon. Members opposite call the "middle classes".
When they refer to the "middle classes," I am not sure whether hon. Gentleman opposite mean simply Surtax payers who, according to the figures, represent about 1 per cent. of the population. But if hon. Gentlemen opposite mean a wider range of the community than Surtax payers, I think that the proposal we are putting forward would go a long way to assist that group, who, among other types of people, have a good ground for asking relief on the argument of need.
I think it might legitimately be said that many of these people have already been greatly helped since pre-war days by the National Health Service, on one side, and by scholarships for sending their children to the universities, on the other. That is relevant to a discussion about relief by way of Income Tax. Nevertheless, they have a claim, and I think, also, that this is a better way of meeting it than the proposal of the Commission for higher child allowances as income rises, which seems to us to be going too far in giving a greater benefit at the higher levels of income. It is true that, even with this proposal, in this Clause the men or the families with the

highest income, since they are paying more tax, get greater benefit than those on a lower income.
I think that this is a legitimate concession to the "inequalitarian doctrine," if I may so call it. Otherwise it is impossible to make a shift at all as between small and large families in the middle levels of income. We feel that this is justified while, on the whole, we do not feel justified in going so far as the Commission proposed and paying higher allowances for higher incomes or—as hon. Members opposite propose in another new Clause which we shall have before us—that there should be an outright tax relief for expenditure on education.
Without going into that matter at length, it seems to me that the same argument holds against that as against the oft-made suggestion that there should be an Income Tax allowance for the cost of travelling to work. After all, if anyone chooses to spend more than his fellows on travelling to work, if he chooses to live at Brighton and to travel to London with a first-class season ticket every day, he is welcome to do so, but I do not think that he has any right to charge the cost of so doing to the Exchequer and to his fellow taxpayers. I suggest that exactly the same principle applies to Income Tax allowances for the man who, of his own free will, chooses to spend money on education.
For that reason, we could not accept that suggestion, but we commend the proposal in this Clause to increase the amount of the allowance as fair and reasonable.

4.0 p.m.

Lieut.-Colonel W. H. Bromley-Davenport: Am I in order, Sir Charles, in now moving my proposed new Clause now?

The Chairman: I am not selecting that Clause.

Lieut.-Colonel Bromley-Davenport: Then I will just touch on it lightly, like a feather.

The Chairman: I am not asking the hon. and gallant Gentleman to move his Clause. He can put his case for it, but the Clause will not be selected when it is reached.

Lieut.-Colonel Bromley-Davenport: The object of my excellent new Clause, "Allowance in respect of school fees," is to provide a tax rebate for those who educate their own children at their own expense instead of sending them to the State schools to be educated at the expense of their fellow taxpayers. A great many Members of this Committee pay lip-service to the plight of the middle classes. My right hon. Friend the Chancellor of the Exchequer has gone a long way to help them in his excellent proposals this year by enabling certain sections of the community, those who are self-employed, to provide for their own pensions, but that is not enough. Here is an opportunity for him to help all those people who, despite penal taxation, provide out of their own pockets and at great personal sacrifice for the education of their children.
If the proposal in my new Clause were accepted it would benefit everybody, including children who go to the State schools. The number of children at State schools continues to increase, and is not expected to fall till 1958, I understand. The magnificent building record of Conservative Governments is known to all, but despite the immense number of buildings that have been put up and the number reconditioned, we have not yet caught up with requirements. There are not enough State schools or enough State classrooms. Therefore, there are too many children in each class. It follows that the more people we can encourage to pay for their children's education and who can afford to do so, the better.
The number of children whose education is paid for by their parents is 500,000 while, according to the latest figures I have been able to obtain, those for 1954, the number of children attending State schools is 6,795,260. For the benefit of those hon. Gentlemen who could not work out the sum, or get it right even if they tried, may I say that the proportion works out that one child in 14 has its education paid for by its parents?
The object of the exercise embodied in my proposed new Clause is to encourage people, despite penal taxation and the increased cost of private and public schools, to continue to send them there. The second object is to encourage others to do so who can afford it. If we could accomplish these objects we should improve conditions in the State schools by

relieving the burden there, and the children at State schools would get a better education. Children who attend public schools would likewise benefit.
How are we to accomplish this object? The Parliamentary Secretary to the Ministry of Education, my right hon. Friend the Member for Runcorn (Mr. Vosper), in his charming and accurate way, replied to a Question put by one of my hon. Friends. He stated that the total expenditure per child from rates and taxes combined, over the whole education service from 1954 to 1955, was roughly £60. Therefore, in framing my proposed new Clause I suggest that the Income Tax authorities should be able to deduct a sum up to that figure in respect of school fees.
The middle classes deserve a break before their backs are broken. All Chancellors have done a lot for the wage earners in recent years by way of tax reduction. In 1955, nearly 2½ million of the lower Income Tax range received total exemption from Income Tax. Since October, 1951, prices have gone up 20 per cent., but wage rates have gone up 32 per cent. How many salaries have gone up as much as that? Insurance benefits and National Assistance scales have gone up, but the middle-class people are the sitting pheasants. They cannot strike; they go struggling on. They are the first class of people I propose will be helped by my new Clause.
There is another type, which I should like to call "the new rich". My hon. and gallant Friend the Member for Worthing (Brigadier Prior-Palmer) referred in the Budget debate to council houses, into which it was known that as much as £40 to £50 was going in a week. We have only to look at the cars, and the television masts over the top of the houses, to realise that there may be some truth in that statement. To reinforce it there was an excellent article in the Sunday Times last Sunday. In describing the new towns, the newspaper said that the average family spent between £5 and £8 a week on beer, gambling and cigarettes.
Surely that money is literally frittered away. I am sure that a large number of these people have never thought or considered saving to pay for their children's education. They are accustomed to believing that, from the cradle to the grave, the State will provide everything.
My new Clause would provide an excellent incentive to such people to save money and to provide their children with better education. Children at the State schools would also benefit, because there would be more room and smaller classes there.
There is a third section of our public that my new Clause would help, the public schools themselves. I do not wish to raise a party question here, but how often has it been stated by hon. Gentlemen opposite that their ultimate objective is to destroy capitalism? Whether they succeed or not, if taxes go on increasing and the cost of living continues to go up, the public schools will end altogether, and that would be a national disaster. The middle class is the sitting pheasant. It sits at the top of a high tree in the covert, and successive Chancellors of the Exchequer have been unsporting enough to go on firing at it. They have very nearly killed it.
The middle class has to stint and economise for its children, and will go on doing so, even though forced to sell its homes and spend its savings, and, indeed, lose its independence. Some have been obliged to send their children to State schools as a result. [Laughter.] I do not want to disturb hon. Gentlemen opposite too much, but if they want to shout will they please shout later. Some middle-class people object to being obliged to send their children to State schools. That may be good Socialism, but it is bad Conservatism. These people do not want to batten or depend in any way upon the Welfare State, because the essence of their outlook is independence and responsibility. That is the outlook of the Conservative Party, and both are being destroyed by high taxation.
For the third time I am going to talk about the sitting pheasant. My right hon. Friend the Chancellor is well known as one of the finest shots in England. If he shoots at this bird, it will have "had it." I ask him to help this unfortunate class of people in every way he can. However much hon. Gentlemen opposite may laugh, one thing is certain. If the middle classes are destroyed that will be a disastrous day for England, so please do something more to help them.

Mr. Austen Albu: I think that all of us on this side of the Com-

mittee enjoy the class prejudice of the hon. and gallant Member for Knutsford (Lieut.-Colonel Bromley-Davenport). At any rate, we know exactly where we stand when he is speaking and there is no doubt what he stands for.
I must say I was slightly surprised at his definition of the middle class because, according to that, it consists of those people who send their children to fee-paying schools and, again according to the definition of the hon. and gallant Member, it amounts to 7 per cent. of the population. There have been a large number of attempts at defining the class structure of this very complicated country. There are economic, sociological and other definitions, but I do not think that anyone has ever reduced the middle class to a total of 7 per cent. of the whole population. If we want to include what generally are called the middle class, we find that the great majority of them send their children to State schools.
Nevertheless, the hon. and gallant Member made a clear plea for tax reliefs for the wealthier members of the community. His speech contained some very strange logic indeed. It is well known that our State school system is not yet good enough by any means. The number of children per teacher in State schools, including many of the grammar schools I regret to say, is still too high. That cannot be said of fee-paying schools, where the number is very much lower. If we were to give tax relief to those who send their children to fee-paying schools we should be attracting the limited number of resources from the State schools and putting them in the fee-paying schools.
The same argument has been used by hon. Members opposite about the National Health Service. The more that is spent on private medical attention the less is there available for the 90 per cent. or so of the population who benefit from the National Health Service. We on this side of the Committee would rather see what is taking place in regard to the National Health Service take place in regard to education. There is no doubt that the middle classes, in whom the hon. and gallant Member is so interested, are becoming more and more interested in a better health service. The more of them who send their children to the ordinary State schools—secondary-modern,


technical and grammar schools—the more we shall have for a better State education service. I feel than any such attempt to give an advantage to those who wish to pay fees for the education of their children would be against the whole development of our society in recent years and against the best development of our educational system.
I am not pretending that our educational system is good enough—there is no country in the world in which it is—but I do not want to see tax relief given which would have the effect of acting as a deterrent to the general system of education from which, on the figures of the hon. and gallant Member, 93 per cent. of the children of the country benefit. Therefore, I am glad that the new Clause in the name of the hon. and gallant Member is not being called and will not be voted upon. I rather imagine that, in spite of his well-known courage, moral and physical, the hon. and gallant Member would find it extremely difficult to carry himself or any of his hon. Friends into the Lobby if it had been called.
I prefer to support the new Clause in the name of my right hon. Friend the Member for Battersea, North (Mr. Jay), which deals with his well-known personal interest in large families. On nearly every previous occasion my right hon. Friend has declared his personal interest in this matter and I do not think that hon. Members will desire him to do so again today. I do not propose to redeploy the whole argument put forward by my right hon. Friend, particularly the very startling figures he gave about the change in the relationship of a taxpayer with a large family and a taxpayer with no family.
As my right hon. Friend said, the change which has taken place since the war merely because of the fall in the value of money and the incidence of taxation was never intended by any Chancellor to have this effect. Whether we are dealing with taxation, wages or general family incomes, it is always the large family which suffers at present. If one compares the large family with the standard of living which can be enjoyed by even young persons before they are married, and before National Service is done, with that of bachelors and unmarried people after National Service, or married persons without children, especially married persons when both the

husband and the wife are working, one sees that the level of the standard of living for similar jobs and incomes is extraordinarily inconsistent.
4.15 p.m.
In my opinion, we have not done nearly enough to assist the family. Of course, that is particularly important during the time when children are growing up and expenses are high. When children are grown up both parents can work and expenses become lower. I am certain there is a case for an increased tax relief and, although I would be out of order if I pursued it at length, I think there is a case for increased family allowances for those with large families. I support the new Clause and I hope the Chancellor will never open his ears to his hon. and gallant Friend's suggestion that he should take his eye off the pheasant for a moment.

Mr. Angus Maude: I do not propose to detain the Committee for very long, and probably I would not have spoken had it not been for something said by the right hon. Member for Battersea, North (Mr. Jay). Discussing the need for an increased family allowance, he rightly pointed out that there was an alternative to his proposal to increase the flat rate of allowance—the proposal of the Royal Commission on the Taxation of Profits and Income, to substitute a graduated percentage child allowance up to a maximum level on an income of, perhaps, £1,500 or £2,000 a year.
In my view, the right hon. Member dismissed that somewhat cursorily on no better grounds than that it seemed to him and to his hon. Friends to be unegalitarian which, of course, in some ways it is. I do not dissent from most of what the right hon. Member said about the very considerable need for some improvement in the system of child allowances for Income Tax. There is no question, as he said, that the position of married couples with medium or large families has considerably deteriorated compared with the pre-war position vis-à-vis the unmarried and childless.
I would, however, ask my right hon. Friend to believe that many of us do not consider that the proposal of the majority of the Royal Commission can be dismissed nearly so cursorily as the right hon. Member suggested, because it


has innumerable advantages over this proposal. First, there is the fact that it is a much more satisfactory system in a time of rising incomes than a flat rate system. If the cost of living were to continue to rise and wages and salaries were to rise, however slowly or unevenly, with it, in order to maintain the position of large families every Government would have to increase the flat rate of the child allowance continually to keep the heads of large families above water.
It will be obvious that a percentage allowance would not have that disadvantage because it would retain the relative position of the large family as income increased with the cost of living. There is also the advantage that it would do what my hon. and gallant Friend the Member for Knutsford (Lieut.-Colonel Bromley-Davenport) was seeking and much more. I have never been able to agree with him and certain other hon. Friends who want to give a rebate to parents who send their children to independent schools, not because I do not sympathise with their motive, but because I see great difficulties in principle and practice.
I am not attracted by the idea of allowing people to be compensated in cash for contracting out of the social services. I see great difficulties because the precedent could be applied to the National Health Service and a number of other services. Furthermore, I think it is extraordinarily difficult to get a figure of the rebate which would bear any relation to the proportion of a man's tax which did, in fact, go towards the education budget of the country. The percentage increase has the very great advantage that it recognises the plain fact that the expenses of rearing children, including the cost of their education, rise rapidly with income up to somewhere about the middle range, let us say, £2,000 a year. That is to say, it is a human and psychological fact that parents do tend to spend roughly a constant proportion of their incomes on their children, and that, if their income increases, they tend to spend rather more on their children—in housing, holidays, education, clothing and a number of other respects.
The percentage children's allowance, of course, enables the man who prefers to send his son or daughter to a grammar

school, rather than to pay fees at an independent school, to use the money he saves in order to save for a university, for sending the child abroad, for professional training, and so forth. It gives precisely the sort of free choice in expenditure which I should have thought a Conservative Chancellor of the Exchequer might well wish to encourage.
I believe that this suggestion now has the support of two Royal Commissions, not merely the Royal Commission on the Taxation of Profits and Income, but also the Royal Commission on Population, in 1949, of which I believe the wife of the right hon. Member for Battersea, North was a member, and, I believe, dissented from that recommendation in the minority Report. In 1949, the proposal had not been very well thought out or refined, and the proposal of the Royal Commission on the Taxation of Profits and Income seemed to me to be very much better. It placed a maximum limit at an income of, I think, £1,500 or £2,000, so that incomes above that would receive the percentage children's allowance at the maximum rate and no more.
This is a direction in which my right hon. Friend might well turn in subsequent years, when we hope that he will feel able, in the then economic circumstances, to give some benefits to those people of middle incomes and parents of large families who, as I think everybody in the Committee will agree, are finding life particularly difficult at present. I hope that he will not allow himself to be deterred from it by the somewhat summary rejection of the Royal Commission's recommendation by the right hon. Gentleman opposite.

Dr. Horace King: I hope that the Chancellor of the Exchequer will not be embarrassed if members of the Opposition urge him to resist the proposals made by the hon. and gallant Member for Knutsford (Lieut.-Colonel Bromley-Davenport). At the same time, I would urge him to give careful consideration to what my right hon. Friend the Member for Battersea, North (Mr. Jay) said from the Opposition Front Bench about the new Clause which he moved, and with which I am in complete sympathy.
I rise to urge the Chancellor, whatever else he does in this Finance Bill, not to


accept the proposal to subsidise the children of middle-class parents who seek to buy their children out of State education. When I listened to the hon. and gallant Member for Knutsford, I was appalled at the practical demonstration in his speech of the survival of class warfare in this country even in these enlightened days.
Anyone who can object to someone earning £40 a week merely because he is a worker, or to £40 a week going into a home merely because it is a working-class home, anyone who can assume that the only person who is likely to spend one-fifth of his income on beer and tobacco is a member of the working classes, ought to remember that he comes to this House, in the last resort, by the votes of hundreds of ordinary respectable, decent working-class people in his own constituency.
To divide the people of England into these two groups, and to assume that all working-class families are getting £40 a week today, and that all working-class people fritter away their incomes, while all middle-class people prudently save theirs, is a lamentable, class-ridden picture of the community, which is, in fact, vastly different from that. May I say, too, that the withers of hon. Members on this side of the Committee are not wrung when the hon. and gallant Member for Knutsford claims to suggest that one of the hardships among some middle-class people is that they are now being compelled to send their children to State schools?
His proposal was a narrow one. He sought to give, for some children in the country between the ages of five and 15, a tax relief to the parents of £60, which would mean between £30 and £50, according to the income of the parents, as a contribution by the Chancellor of the Exchequer to the school fees of those children, and this in a country which has to provide under the 1944 Act an efficient primary education and an efficient secondary education for all our children.
If, as the hon. and gallant Gentleman suggests, what the State is providing for all children, including some of these children of the middle classes, is not the best, then it ought to be. If State education has lagged behind the best private education, it has only lagged behind because some parents have wilfully with-

drawn their children from the State schools, and have then continued, as governors, in Parliament, in local authorities, as local government officers and in the Civil Service, to run the schools for somebody else's children.
I should like to say this to the members of the middle classes. Already the best State schools are approaching some of the best private schools in the education which they provide for children; already the best State schools are much better than the worst private schools. If the Chancellor were to give this tax concession, he would in fact be bribing some of the middle classes to hurt their children by sending them, in some cases, to schools which are inferior to the State schools, from which they seek to exclude them.
It may or may not be common ground between both sides of the Committee that we do not wish rapidly and revolutionarily to destroy the class system of education. I am not sure whether I would include myself in that common view. But most people hope that class education will wither away as we build up the State schools until they have achieved complete parity with other schools. At any rate, I would have thought that it was common ground between both sides of the Committee that, while we do not proceed revolutionarily to tear up the present class structure of education, we certainly would not wish, by tax concessions, to bolster it up. If the Chancellor has the amount of money which is involved in the new Clause moved by the hon. and gallant Gentleman and wishes to spend it, I suggest that he could spend it much more effectively and efficiently on the State schools.
Some day, we shall end the anomaly by which this country, alone in the world, divides children up from birth and sends them to two different sets of schools for their education. We have done that as far as the Health Service is concerned, and, even in the days when some people could buy medical attention and surgical treatment, and when some people were deprived of it, nobody had the impertinence to ask this House for an Income Tax concession to enable them to purchase privileges in health. I hope that, whatever else the Chancellor does during this Committee stage, he will resist the proposal of the hon. and gallant Member for Knutsford.

4.30 p.m.

Mr. Ronald Bell: I should like to support both the proposals before the Committee in principle, although, in view of the financial stringency of the times, I support neither in fact. I hope that in the not-too-distant future, when my right hon. Friend feels able to be more generous, he will look at both proposals.
First, I am attracted towards the new Clause which suggests larger child allowances for the reasons which have been deployed by the right hon. Member for Battersea, North (Mr. Jay) and my hon. Friend the Member for Ealing, South (Mr. Maude); but I am also attracted by the arguments put forward by my hon. and gallant Friend the Member for Knutsford (Lieut.-Colonel Bromley-Davenport), for I proposed such a new Clause as his some years ago.
I do not take the view taken by hon. Members opposite, notably the hon. Members for Edmonton (Mr. Albu) and Itchen (Dr. King), that it is inherently wrong that a parent should spend money on obtaining a better education for his children. We pay people differently according to their work, and the money which they are given should buy valuable things.
The idea that differentials should be expendable only on champagne and caviare is too ridiculous. If that is so, parents who spend their money on the education of their children are performing a public service. It is not simply a question of what is the best kind of education; in a country like this there ought to be room for a great many opinions on what is the best kind of education. If there were not conflicting opinions on a great variety of prescriptions, we should lose all the advantage which a nation derives from conflicting ideas worked out in practice.
I therefore want to see private schools encouraged for precisely the opposite reasons to those given by my hon. Friend the Member for Ealing, South—because I am attracted by the idea of people being compensated in cash for contracting out of a social service.
As the social services expand in their scope and their weight on the community, we cannot indefinitely avoid facing this issue. If people are to enjoy the freedom in which we believe in the disposition of

their resources, is it not illogical that a parent who decides to give his child a much more expensive form of education, whether it be better or not, should also by law be compelled to pay fully for the less expensive form which he is not using?
I tried to draft an Amendment to deal with this matter some years ago and I therefore know that there are difficulties, technical and political; but I believe that they ought to be and can be overcome, and I hope that my right hon. Friend, not this year, which is one of financial stringency, but at some time in the future, will courageously face this controversial issue, which is far more important to the welfare of the country than many people imagine, and will not only give larger child allowances, which I think are entirely justified, as soon as we can afford them, but will also try to help those who happen not to like the particular prescription of education which the State prescribes and wish, at their own expense, to give their children another kind.

Mr. George Chetwynd: I do not think it necessary at this stage to argue the necessity for giving some kind of assistance to those with large families. Unfortunately, the fact that we are now dealing with a new Clause on Income Tax rules out those people with the largest families and to whom the greatest help should be given, because these are precisely the people who are not fortunate enough to pay Income Tax. Thus, one whole range of people who ought to be compensated cannot be discussed. If any amelioration were to be given, I would rather it were given in the form of family allowances to the first child or increased family allowances to the other children than in the way suggested in the new Clause.
Nevertheless, we are rigidly confined to discussing whether it is right that people with large families should be given an extra relief from Income Tax of £25 per child, and I think that the case for accepting that proposition has been made out completely. Perhaps I may for a moment deal with the case made by the hon. and gallant Member for Knutsford (Lieut.-Colonel Bromley-Davenport), who is no longer in his place. His proposals, supported by the hon. Member for Buckinghamshire, South (Mr. R. Bell), were completely unacceptable politically


to hon. Members on this side of the Committee and, I think, to many of his own supporters. We cannot put back fifty years of history by a new Clause of this kind—and that is precisely what hon. Members opposite seek.
Socially, too, the proposals are completely undesirable. They lead away from the kind of society which we have been trying to create over the past hundred or fifty years, and even more rapidly over the past ten years. Educationally, we could argue which system is better, but, even so, I think the proposals to give a subsidy to parents sending their children to private schools are educationally undesirable. The remedy lies in their own hands; whether they send them there is their own choice. If they are straining themselves beyond endurance to do it there is a simple remedy—not to send their children there. I am certain that what the State schools offer in education today is the equivalent of anything but that offered by the top public schools.
For these reasons—political, social and educational—the Chancellor should resist the proposals made to him by his hon. Friends. If he has any spare cash, which I doubt—and which, in view of the statement we may have later this week, he probably doubts, too—he could better spend it by stopping the cuts which are pending in the building of State schools rather than by giving a subsidy to keep many schools in existence which on educational grounds ought not to be in existence. Since the war, many private schools have come into existence—

Mr. John Hall: The hon. Gentleman has used the word "subsidy" once or twice. Would he regard it as a subsidy to ensure that a parent pays only once and not twice for education?

Mr. Chetwynd: The choice is freely his. The State schools are there for his children if he wishes to use them. The National Health Service is there if he wants to use it. This also applies to religious schools.
If we accepted such a new Clause as the hon. and gallant Member for Knutsford's we should open the door very wide, and I do not think it wise to do so. I believe that some hon. Members opposite do not think it wise either, and I hope that the Chancellor will not support it. I ask him to give favourable consideration to the proposal put forward by my

right hon. Friend, in the new Clause before the Committee, as the only practical method we have at present of giving assistance to those who are in considerable need of assistance.

The Chancellor of the Exchequer (Mr. Harold Macmillan): It would perhaps be wise to say at the beginning of my speech that I shall not find it part of my duty to recommend the Committee to accept either new Clause. That is not because of any lack of sympathy with the broad thought which lies behind these proposals; that is, that, as things have worked out, the larger families carry rather a heavier strain and the heads of those families carry a burden greater in proportion than they did in the old days—greater, perhaps, than the single man of the same position or with the same income.
Nevertheless, it would be fair to say—as the right hon. Member for Battersea, North (Mr. Jay) knows—that there have been a number of moves in this direction in recent years. The child allowance for Income Tax stood at £70 when we took office. It was increased by my predecessor to £85 and was then further increased to £100. There are strong arguments that it would be desirable to make a further increase, and it would certainly be very agreeable to me as Chancellor if I were able to recommend an increase on this or some future occasion. Nevertheless, since I am not going to recommend the Committee to do so, I should like to take advantage of the very admirable debate that we have had and deal with the important question which has been raised as to whether this is precisely the right method, even as suggested in the first proposed new Clause.
As the Committee knows, the Royal Commission put forward a slightly different plan, for which a strong and powerful plea has been made. It is a matter of balance. It needs considerable thought. But even though, unfortunately, I am not this year able to recommend acceptance of an Amendment costing the Revenue so large a sum, I am at any rate in a position still to consider, as regards the future, whether this method of a direct increase of the flat rate, in which we have followed successive Governments in the past, is the best way, or whether some variation, as recommended by the Commission, would be the better approach.
If this new Clause were accepted, it would cost £26 million in the first year and £32 million in a full year. That would not be in tune with the general purpose of the Budget. As I have said of other new Clauses, I felt it right to recommend to the Committee to accept an increase in taxation and an increase in the probable Budget surplus; that was for reasons which were well known to hon. Members and which were broadly applauded by economic opinion on both sides of the Committee. I thought it right to fortify the Revenue both in indirect and in direct taxation.
The only remissions which I was able to recommend were in the form of those closely associated with the stimulation of saving. Everybody felt that the increase of saving was one of the finest methods we had for dealing with our present difficulties. I was able to recommend remissions, but always within that sphere. I felt that, if I went outside it, I should lay myself open to various suggestions one after another, which would make the whole position of the Budget untenable.
Nevertheless, I would point out, as my hon. and gallant Friend the Member for Knutsford (Lieut.-Colonel Bromley-Davenport) was good enough to mention, that in respect of what are called the middle classes—I detest the expression; I refer to the people whose incomes are of a moderate kind—proposals concerning the self-employed and the professional men have met with generous support from both sides of the Committee. Therefore, even in that respect we have been able, even in this Budget, to do something of particular value to assist a section of the so-called middle or professional classes.
I would also point out, which I think it is only fair to do, that in recent years quite considerable reductions in tax have been made in this range. For instance, the tax paid by a married man with an earned income of £2,000 a year and with two children has been reduced by £133 since 1951. If his income is £3,000 a year his tax has been reduced by £185. Further down the scale, however, a man with a salary of £1,000 a year has had his tax halved. It was £167 in 1951 and it is now £85. For someone earning £700 a year the reduction has been much more spectacular; it has decreased from £57 to £17.

Mr. Jay: I am sure that the right hon. Gentleman observed, from the remarks of the hon. and gallant Member for Knutsford (Lieut.-Colonel Bromley-Davenport), that he did not regard someone earning £40 a week as a member of the middle class.

Mr. Macmillan: I do not wish to be drawn into such issues. We are having an important debate on matters affecting our children.
I was saying that in this range a man earning £2,000 a year has had his tax reduced by £133; a man earning £3,000 a year has had a tax reduction of £185; a man with £1,000 a year has had his tax halved, and that if a man has £700 a year his tax has fallen from £57 to £17. The married man with two children who earned £11 a week and who paid £27 10s. under the former Administration now pays nothing at all. Therefore, I feel that it is quite unfair to say that nothing has been done. Very substantial reductions have been made in this middle class of income.
4.45 p.m.
Nevertheless, we all have every sympathy with the difficulties with which they are faced, and if I may deal with this part of the matter first, I would just say this. I do not want to get drawn into the relative advantages of different forms of education in this country. I think that there are great advantages in variation. I certainly do not think that this ought to be, or is, a party question. Certainly, if we follow practice rather than principle, I observe that the public schools are very well represented among the party opposite.
I do not think that the reasons parents wish to send their children to schools which they attended themselves are ignoble reasons—not at all. I think that such people make great efforts to obtain for their children something which they value. It is often not only the teaching itself which they value. They value something which they think those schools give—tradition and even training of character which, to them, is important. It is a moving and not a laughable matter that many people, as we all know, make great efforts and deprive themselves of a great deal in order to carry on a tradition which in many cases has gone on through many generations and has brought to this


country in every field of endeavour great service and glory.
What I ask myself is whether this method of assisting them as proposed in the new Clause is the right one. I feel that if, when the time comes, we can move into a position in which some of our surplus can be given back to the people who produced it, to the taxpayers, we must choose the best method. I rather doubt whether the method which my hon. and gallant Friend proposes is really the right one. I think that there are other methods of achieving the same thing which would avoid some of the difficulties. I think that most of us, whatever our views—and, of course, we do get keen partisan views—feel that in this form of education to which my hon. Friends have referred there is something very precious to the country, and it would be a pity to prejudice it by bringing it into the field of bitter or partisan discussion.
I now return to the facts of the main new Clause. We raised the Income Tax allowance twice, in 1952 and again last year. I cannot accept a cost of some £26 million this year and £32 million in a full year at this stage. I think, however, that the discussion which we have had has been very valuable, and will certainly give me or any future Chancellor a great deal of useful guidance.
There is one thing that I would add. As we have taken such a lot of people out of Income Tax altogether, I am not at all sure that in a year of stress this proposal is the best method of approach. It is for that reason that in a Budget even where I had to increase direct taxation and indirect taxation we have done two other things which it is only fair should be taken into account. We took

two measures, the first relating to family allowances, which I think is generally welcomed, raising to 18 the age at which the family allowance of 8s. a week will continue if children remain at school or are apprenticed. That is something which ought to be taken into account, for it is helpful. And I have, of course, made a small addition, but still a notable one, in view of the year in which it is given, to the family allowance scale for the third child.

Taking account of the valuable discussion we have had on this whole subject of the family and the children, I would ask the Committee to appreciate that in this year I could not accept the proposed new Clause.

Mr. Jay: I agree with the Chancellor in rejecting the proposal of the hon. and gallant Member for Knutsford (Lieut.-Colonel Bromley-Davenport), and I agree with certain other things that he said. It is, of course, true that a series of increases in the child allowance has been made ever since the war. Our complaint today is that, although certain things have been done, what has been done is not yet enough. I think that it is relevant, when the Chancellor points out the increase in the allowance since 1951, to remind him that there has been a rise in the cost of living of about 4s. 6d. in the £ since that year. That is extremely relevant to this problem.
However, it is mainly to encourage the Chancellor to act on this new Clause next year, if he will not do so this year, that I advise my hon. Friends to press it to a Division.

Question put, That the Clause be read a Second time:—

The Committee divided: Ayes 191, Noes 248.

Division No. 230.]
AYES
[4.51 p.m.


Ainsley, J. W.
Boyd, T. C.
Cronin, J. D.


Albu, A. H.
Braddock, Mrs. Elizabeth
Grossman, R. H. S.


Allaun, Frank (Salford, E.)
Brockway, A. F.
Darling, George (Hillsborough)


Allen, Arthur (Bosworth)
Broughton, Dr. A. D. D.
Davies, Ernest (Enfield, E.)


Allen, Scholefield (Crewe)
Brown, Rt. Hon. George (Belper)
Deer, G.


Anderson, Frank
Brown, Thomas (Ince)
de Freitas, Geoffrey


Bacon, Miss Alice
Butler, Herbert (Hackney, C.)
Delargy, H. J.


Bellenger, Rt. Hon. F. J.
Butler, Mrs. Joyce (Wood Green)
Dodds, N. N.


Benson, G.
Callaghan, L. J.
Donnelly, D. L.


Beswick, F.
Chapman, W. D.
Dugdale, Rt. Hn. John (W. Brmwch)


Blackburn, F.
Chetwynd, G. R.
Dye, S.


Blenkinsop, A.
Clunie, J.
Ede, Rt. Hon. J. C.


Blyton, W. R.
Coldrick, W.
Edelman, M.


Boardman, H.
Collick, P. H. (Birkenhead)
Edwards, Rt. Hon. John (Brighouse)


Bowden, H. W. (Leicester, S.W.)
Collins, V. J. (Shoreditch &amp; Finsbury)
Edwards, Rt. Hon. Ness (Caerphilly)


Bowen, E. R. (Cardigan)
Cove, W. G.
Edwards, Robert (Bilston)


Bowles, F. G.
Craddock, George (Bradford, S.)
Evans, Albert (Islington, S.W.)




Evans, Edward (Lowestoft)
King, Dr. H. M.
Reid, William


Fienburgh, W.
Lawson, G. M.
Robens, Rt. Hon. A.


Finch, H. J.
Lewis, Arthur
Roberts, Albert (Normanton)


Fraser, Thomas (Hamilton)
Lindgren, G. S.
Roberts, Goronwy (Caernarvon)


Gaitskell, Rt. Hon. H. T. N.
Lipton, Lt.-Col. M.
Robinson, Kenneth (St. Pancras, N.)


Gibson, C. W.
Logan, D. G.
Ross, William


Gordon Walker, Rt. Hon. P. C.
Mabon, Dr. J. Dickson
Royle, C.


Greenwood, Anthony
McGhee, H. G.
Short, E. W.


Grey, C. F.
McInnes, J.
Silverman, Julius (Aston)


Griffiths, David (Rother Valley)
McKay, John (Wallsend)
Simmons, C. J. (Brierley Hill)


Griffiths, Rt. Hon. James (Llanelly)
McLeavy, Frank
Slater, Mrs. H. (Stoke, N.)


Griffiths, William (Exchange)
Mahon, Simon
Slater, J. (Sedgefield)


Grimmond, J.
Mallalieu, E. L. (Brigg)
Smith, Ellis (Stoke, S.)


Hale, Leslie
Mallalieu, J. P. W. (Huddersfd, E.)
Snow, J. W.


Hall, Rt. Hn. Glenvil (Colne Valley)
Mann, Mrs. Jean
Sorensen, R. W.


Hamilton, W. W.
Marquand, Rt. Hon. H. A.
Sparks, J. A.


Hannan, W.
Mason, Roy
Stokes, Rt. Hon. R. R. (Ipswich)


Harrison, J. (Nottingham, N.)
Mayhew, C. P.
Stones, W. (Consett)


Hastings, S.
Messer, Sir F.
Stross, Dr. Barnett (Stoke-on-Trent, C.)


Hayman, F. H.
Mikardo, Ian
Summerskill, R. Hon. E.


Healey, Denis
Mitchison, G. R.
Sylvester, G. O.


Henderson, Rt. Hn. A. (Rwly Regis)
Monslow, W.
Taylor, Bernard (Mansfield)


Herbison, Miss M.
Moody, A. S.
Thomson, George (Dundee, E.)


Hewitson, Capt. M.
Morrison, Rt. Hn. Herbert (Lewis'm, S.)
Tomney, F.


Hobson, C. R.
Moyle, A.
Warbey, W. N.


Holman, P.
Neal, Harold (Bolsover)
Weitzman, D.


Holmes, Horace
Noel-Baker, Rt. Hon. P. (Derby, S.)
Wells, Percy (Faversham)


Holt, A. F.
Oliver, G. H.
Wells, William (Walsall, N.)


Howell, Charles (Perry Barr)
Oram, A. E.
West, D. G.


Hubbard, T. F.
Orbach, M.
Wheeldon, W. E.


Hughes, Cledwyn (Anglesey)
Oswald, T.
White, Mrs. Eirene (E. Flint)


Hughes, Emrys (S. Ayrshire)
Owen, W. J.
White, Henry (Derbyshire, N.E.)


Hunter, A. E.
Paling, Rt. Hon. W. (Dearne Valley)
Wilkins, W. A.


Irving, S. (Dartford)
Paling, Will T. (Dewsbury)
Williams, Rev. Llywelyn (Ab'tillery)


Isaacs, Rt. Hon. G. A.
Palmer, A. M. F.
Williams, Rt. Hon. T. (Don Valley)


Janner, B.
Parkin, B. T.
Williams, W. R. (Openshaw)


Jay, Rt. Hon. D. P. T.
Paton, John
Williams, W. T. (Barons Court)


Jeger, George (Goole)
Pearson, A.
Willis, Eustace (Edinburgh, E.)


Jeger, Mrs. Lena (Holbn &amp; St. Pncs, S.)
Peart, T. F.
Wilson, Rt. Hon. Harold (Huyton)


Johnson, James (Rugby)
Price, J. T. (Westhoughton)
Woodburn, Rt. Hon. A.


Johnston, Douglas (Paisley)
Price, Philips (Gloucestershire, W.)
Woof, R. E.


Jones, Rt. Hon. A. Creeoh (Wakefield)
Probert, A. R.
Yates, V. (Ladywood)


Jones, David (The Hartlepools)
Proctor, W. T.
Younger, Rt. Hon. K.


Jones, Elwyn (W. Ham, S.)
Pryde, D. J.
Zilliacus, K.


Jones, J. Idwal (Wrexham)
Randall, H. E.



Jones, T. W. (Merioneth)
Rankin, John
TELLERS FOR THE AYES:


Kenyon, C.
Redhead, E. C.
Mr. J. Taylor and


Key, Rt. Hon. C. W.
Reeves, J.
Mr. G. H. R. Rogers.




NOES


Allan, R. A. (Paddington, S.)
Butcher, Sir Herbert
Erroll, F. J.


Alport, C J. M.
Butler, Rt. Hn. R. A. (Saffron Walden)
Farey-Jones, F. W.


Amery, Julian (Preston, N.)
Campbell, Sir David
Fell, A.


Amory, Rt. Hn. Heathcoat (Tiverton)
Carr, Robert
Finlay, Graeme


Anstruther-Gray, Major Sir William
Channon, H.
Fort, R.


Arbuthnot, John
Cole, Norman
Freeth, D. K.


Armstrong, C W.
Conant, Maj. Sir Roger
Gammans, Sir David


Ashton, H.
Cooper, Sqn. Ldr. Albert
George, J. C. (Pollok)


Atkins, H. E.
Cooper-Key, E. M.
Gibson-Watt, D.


Baldock, Lt.-Cmdr. J. M.
Cordeaux, Lt.-Col. J. K.
Glover, D.


Baldwin, A. E.
Corfield, Capt. F. V.
Godber, J. B.


Balniel, Lord
Craddock, Beresford (Spelthorne)
Gough, C. F. H.


Banks, Col. C.
Crouch, R. F.
Gower, H. R.


Barber, Anthony
Crowder, Sir John (Finchley)
Graham, Sir Fergus


Barter, John
Crowder, Petre (Ruislip—Northwood)
Grant, W. (Woodside)


Baxter, Sir Beverley
Cunningham, Knox
Grant-Ferris, Wg. Cdr. R. (Nantwich)


Beamish, Maj. Tufton
Currie, G. B. H.
Green, A.


Bell, Philip (Bolton, E.)
Dance, J. C. G.
Gresham Cooke, R.


Bell, Ronald (Bucks, S.)
Davidson, Viscountess
Grimston, Hon. John (St. Albans)


Bevins, J. R. (Toxteth)
D'Avigdor-Goldsmid, Sir Henry
Grimston, Sir Robert (Westbury)


Biggs-Davison, J. A.
Deedes, W. F.
Gurden, Harold


Bishop, F. P.
Dodds-Parker, A. D.
Hall, John (Wycombe)


Black, C. W.
Donaldson, Cmdr. C. E. McA.
Hare, Rt. Hon. J. H.


Body, R. F.
Doughty, C. J. A.
Harris, Frederic (Croydon, N.W.)


Boothby, Sir Robert
du Cann, E. D. L.
Harris, Reader (Heston)


Bossom, Sir A. C.
Dugdale, Rt. Hn. Sir T. (Richmond)
Harrison, A. B. C. (Maldon)


Boyd-Carpenter, Rt. Hon. J. A.
Duncan, Capt. J. A. L.
Harrison, Col. J. H. (Eye)


Braine, B. R.
Duthie, W. S.
Harvey, Air Cdre. A. V. (Macclesfd)


Braithwaite, Sir Albert (Harrow, W.)
Eccles, Rt. Hon. Sir David
Harvey, Ian (Harrow, E.)


Bromley-Davenport, Lt-Col. W. H.
Eden, J. B. (Bournemouth, West)
Harvey, John (Walthamstow, E.)


Brooke, Rt. Hon. Henry
Elliot, Rt. Hon. W. E.
Harvie-Watt, Sir George


Brooman-White, R. C.
Emmet, Hon. Mrs. Evelyn
Hay, John


Bullus, Wing Commander E. E.
Errington, Sir Eric
Heald, Rt. Hon. Sir Lionel







Heath, Rt. Hon. E. R. G.
Macdonald, Sir Peter
Ridsdale, J. E.


Henderson, John (Cathcart)
McKibbin, A. J.
Robertson, Sir David


Hill, Rt. Hon. Charles (Luton)
Mackie, J. H. (Galloway)
Robinson, Sir Roland (Blackpool, S.)


Hill, Mrs. E. (Wythenshawe)
McLaughlin, Mrs. P.
Roper, Sir Harold


Hinchingbrooke, Viscount
Maclay, Rt. Hon. John
Schofield, Lt.-Col. W.


Hirst, Geoffrey
McLean, Neil (Inverness)
Scott-Miller, Cmdr. R.


Holland-Martin, C. J.
Macmillan, Rt. Hn. Harold (Bromley)
Sharpies, R. C.


Hope, Lord John
Macpherson, Niall (Dumfries)
Shepherd, William


Hornby, R. P.
Madden, Martin
Simon, J. E. S. (Middlesbrough, W.)


Hornsby-Smith, Miss M. P.
Maitland, Cdr. J. F. W. (Horncastle)
Soames, Capt. C.


Horobin, Sir Ian
Maitland, Hon. Patrick (Lanark)
Spearman, Sir Alexander


Howard, Hon. Greville (St. Ives)
Manningham-Buller, Rt. Hn. Sir R.
Speir, R. M.


Howard, John (Test)
Marples, A. E.
Spence, H. R. (Aberdeenshire, W.)


Hudson, Sir Austin (Lewisham, N.)
Marshall, Douglas
Spens, Rt. Hn. Sir P. (Kens'gt'n, S.)


Hughes Hallett, Vice-Admiral J.
Mathew, R.
Stanley, Capt. Hon. Richard


Hulbert, Sir Norman
Maude, Angus
Stevens, Geoffrey


Hutchison, Sir Ian Clark (E'b'gh, W.)
Maudling, Rt. Hon. R.
Steward, Harold (Stockport, S.)


Hylton-Foster, Sir H. B. H.
Mawby, R. L.
Steward, Sir William (Woolwich, W.)


Iremonger, T. L.
Maydon, Lt.-Comdr, S. L. C.
Studholme, Sir Henry


Irvine, Bryant Godman (Rye)
Medlicott, Sir Frank
Summers, Sir Spencer


Jenkins, Robert (Dulwich)
Milligan, Rt. Hon. W. R.
Taylor, Sir Charles (Eastbourne)


Jennings, J. C. (Burton)
Molson, Rt. Hon. Hugh
Taylor, William (Bradford, N.)


Johnson, Dr. Donald (Carlisle)
Moore, Sir Thomas
Thomas, P. J. M. (Conway)


Johnson, Eric (Blackley)
Morrison, John (Salisbury)
Thompson, Kenneth (Walton)


Johnson, Howard (Kemptown)
Nabarro, G. D. N.
Thompson, Lt.-Cdr. R. (Croydon, S.)


Joseph, Sir Keith
Nairn, D. L. S.
Thornton-Kemsley, C. N.


Keegan, D.
Neave, Alrey
Tilney, John (Wavertree)


Kerby, Capt. H. B.
Nicholson, Godfrey (Farnham)
Touche, Sir Gordon


Kerr, H. W.
Nicolson, N. (B'n'm'th, E. &amp; Chr'ch)
Turner, H. F. L.


Kimball, M.
Nield, Basil (Chester)
Turton, Rt. Hon. R. H.


Kirk, P. M.
Nugent, G. R. H.
Vane, W. M. F.


Lagden, G. W.
Oakshott, H. D.
Vaughan-Morgan, J. K.


Lambert, Hon. G.
O'Neill, Hn. Phelim (Co. Antrim, N.)
Vickers, Miss J. H.


Lancaster, Col. C. G.
Ormsby-Gore, Hon. W. D.
Wakefield, Edward (Derbyshire, W.)


Langford-Holt, J. A.
Orr, Capt. L. P. S.
Walker-Smith, D. C.


Leather, E. H. C.
Orr-Ewing, Sir Ian (Weston-S-Mare)
Wall, Major Patrick


Leavey, J. A.
Osborne, C.
Ward, Hon. George (Worcester)


Legge-Bourke, Maj. E. A. H.
Page, R. G.
Ward, Dame Irene (Tynemouth)


Lindsay, Hon. James (Devon, N.)
Pannell, N. A. (Kirkdale)
Waterhouse, Capt. Rt. Hon. C.


Lindsay, Martin (Solihull)
Peyton, J. W. W.
Webbe, Sir H.


Linstead, Sir H. N.
Pilkington, Capt. R. A.
Whitelaw, W. S. I. (Penrith &amp; Border)


Lloyd, Maj. Sir Guy (Renfrew, E.)
Pitt, Miss E. M.
Williams, Paul (Sunderland, S.)


Lloyd, Rt. Hon. Selwyn (Wirral)
Powell, J. Enoch
Williams, R. Dudley (Exeter)


Lloyd-George, Maj. Rt. Hon. G.
Prior-Palmer, Brig. O. L.
Wills, C. (Bridgwater)


Longden, Gilbert
Profumo, J. D.
Wilson, Geoffrey (Truro)


Low, Rt. Hon. A. R. W.
Raikes, Sir Victor
Wood, Hon. R.


Lucas, Sir Jocelyn (Portsmouth, S.)
Ramsden, J. E.
Woollam, John Victor


Lucas, P. B. (Brentford &amp; Chiswick)
Redmayne, M.



Lucas-Tooth, Sir Hugh
Rees-Davies, W. R.
TELLERS FOR THE NOES:


McAdden, S. J.
Remnant, Hon. P.
Mr. Legh and Mr. Hughes-Young.



Renton, D. L. M.

New Clause.—(INCAPACITATED CHILD.)

To subsection (1) of section two hundred and twelve of the Income Tax Act, 1952 (which relates to relief for children), shall be added the words—
If the claimant proves that he has living at any time within the year of assessment any child who has not attained the age of twenty-one years at the commencement of that year and who is incapacitated by illness, infirmity or disablement from undergoing full-time instruction at any school or other educational establishment or from following any gainful occupation, he shall be entitled in respect of each such child to a deduction from the amount of income tax with which he is chargeable equal to tax at the standard rate on one hundred and fifty pounds".—[Mr. Cronin.]

Brought up, and read the First time.

5.0 p.m.

Mr. John Cronin: I beg to move, That the Clause be read a Second time.
The purpose of this new Clause is quite simple. It is to raise for Income Tax purposes the child allowance from £100 to £150. It is not quite so clear who are to be the beneficiaries under the Clause or what type of people they are. The Clause says that they are children who are
incapacitated by illness, infirmity or disablement from undergoing full-time instruction at any school or other educational establishment, or from following any gainful occupation …
I do not wish to make any emotional appeal to the Committee, or to harrow its feelings, but I think it is possible that some hon. Members have not a clear idea what sort of people these children are, because, by the very nature of their incapacity, they are very largely hidden from public gaze.
Incapacitated children include spastics, who are a type of persons with which the Committee is familiar and of whom there are about 10,000 in the country at any given time. They also include the mentally deficient, ranging from the milder form of mental deficiency—the type who are ineducable—to the helpless idiot who is incapable of guarding himself against the common dangers of life such as falling on a fire or falling out of a window. They also include epileptics unamenable to treatment, blind children, deaf and dumb children, children born with congenital mutilations and children mutilated by accidents.
I am sure the Committee will agree that children of this type are eminently eligible candidates for some help. The beneficiaries, of course, would be the children and not the parents. I think that all hon. Members who have had experience of cases of this type will agree that the parents of such children are usually of the very best type and do everything possible for their incapacitated children.
There are two main premises of my argument. The first is that these children inflict on their parents very heavy costs. They are much heavier on clothes than ordinary children and, therefore, involve extra expense in that way, and they necessitate a much heavier laundry bill. Many of them have to have special medicines which, to some extent, have to be paid for, and very often constant attendance, which is an expensive item.
In the majority of cases, incapacitated children cannot use public transport for normal purposes or for going away on holiday. These children, quite unwittingly, often do a lot of damage, which involves expense, in the homes of their parents or elsewhere. They also have to have some sort of rudimentary education which, again, frequently costs money. There are other financial losses which the parents of such children have to suffer.
As I have said, they require constant supervision. That means that if the parents cannot afford to employ a permanent nurse, one of the parents has to stay at home so as to be with the child continuously. In these days, when it is very common for both parents to work, the Committee will appreciate, I think, that that imposes a very severe economic burden on the family, particularly when

there are other members of the family who have to be supported.
Another important economic burden is that when the child reaches the normal school-leaving age it cannot earn anything and thus contribute to its support in any way. Therefore, all in all, the parents suffer a very heavy economic burden.
The second premise of my argument is that the economic burden being carried by the parents is one which is really the obligation of the State itself. Normally, these children would be admitted to hospitals or to similar institutions which are, of course, entirely chargeable to the State. If they were admitted to a mental or ordinary hospital the cost to the State would be about £12 a week per child. Instead, that burden is being borne by the parents. I am not suggesting, of course, that it costs the parents £12 a week to maintain a child of this sort, but the fact remains that they are suffering a very heavy financial burden which, under modern conditions, is normally recognised as one to be borne by the country as a whole.
In these circumstances, it seems to my hon. Friends and me to be a matter of elementary justice that parents who are paying out heavily for what is really a public expense should receive some sort of indemnity. I feel that that is one of the most important aspects of the arguments in favour of the Clause. The situation at present is a source of some very severe anomalies.
In paragraph 193 of its second Report, the Royal Commission on the Taxation of Profits and Income refers to only one of the anomalies and makes a recommendation. It points out that a child allowance of £100 is allowable to parents of incapacitated children, as in the case of other children, until the year of assessment after the age of 16 has been attained. Thereafter, until the age of 21, or indefinitely, the only allowance available is the £60 dependent relative allowance. That means that at the completely arbitrary age of 16 the parent of an incapacitated child finds that the allowance he receives suddenly drops from £100 to £60 simply because the law is so framed.
That is merely one facet of this situation. My right hon. and hon. Friends put down a new Clause, which has not


been discussed, on that subject. A clear-cut recommendation of the Royal Commission based on this obvious injustice was that to a substantial extent the purpose of this Clause should be put into effect.
There is another anomaly which seems rather unjust. If the child is just able to go to a special school after the age of 16, the parent continues to receive an allowance of £100 instead of £60, but if the child is so incapacitated and such a burden that it cannot even be catered for at a special school, then the allowance is simply the dependent relative allowance of £50. Therefore, we have the quite absurd situation where parents who are relieved of the responsibility of such children receive a much bigger allowance than the parents who are not so relieved and who have to maintain the children completely.
These are two very obvious, and, to my mind, quite absurd anomalies for which, I am sure, the Financial Secretary will feel a very strong case can be made for having them put right. This Clause is based, primarily, on putting right an elementary injustice, and, secondly, on indemnifying people who are bearing an expense which is really the obligation of the State.
I have no doubt that the Financial Secretary has certain objections to the Clause and I shall attempt a minor exercise in mind reading in order to anticipate them. He may well point out that the benefit of the Clause would apply only to Income Tax payers and, therefore, would not apply to a substantial class of person who do not pay Income Tax. I do not think that that can be put forward as a serious argument, otherwise there would be no case for any Income Tax reliefs whatever. Secondly, I do not think it can be suggested that we should not attempt to do good on the basis that we cannot do good for every possible person.
There are other objections which the right hon. Gentleman could use. One is that sometimes other relations support an incapacitated child and they would not be covered by the terms of the Clause. Another is that there is an anomaly, perhaps, between an incapacitated child, for whom there would be tax relief on £150 under the Clause, and other dependent relatives, for whom the allowance is on only £60. That is a minor

matter because it affects only a few compared with the great bulk who would be benefited by the Clause, and it could be rectified by a simple matter of drafting which one would be content to leave to the Financial Secretary and his very able helpers in the Treasury.
Another objection might be that there was no help after the age of 21. After that age, however, a parent can take steps to alienate a part of his income so that it becomes part of the child's income and, therefore, is not subject to tax or is subject to tax at a much lower rate. This arrangement does not apply before the age of 21. The problem after the age of 21, therefore, is completely different.
The Financial Secretary may also point out that the Clause would cost a good deal to implement and that it is now an unpropitious time to saddle the national finances with extra expense. I should like, however, to refer the right hon. Gentleman to the debate on 29th June, 1954, when my hon. Friend the Member for Southampton, Itchen (Dr. King) made a similar plea, although on that occasion the Committee was discussing a proposal to raise the allowance from £85 to £100. At that time, the then Economic Secretary, now Minister of Supply, said:
The cost of the disabled child concession would be very small. I could not give an accurrate figure but it would be negligible. … I am told that the figure might be £1 million or £1½ million a year …"—[OFFICIAL REPORT, 29th June, 1954; Vol. 529, c. 1142.]
The concession required then, of course, was rather smaller than this one—in fact, it involved only about one-third of the amount.

Dr. King: I think that the £1½ million that the former Economic Secretary mentioned included the allowance for apprentices, which we were debating at the same time. The sum involved, therefore, is even less than £1 million.

Mr. Cronin: I am obliged to my hon. Friend for his help. That shows that the amount involved is even smaller than I anticipated. Even if it were not, a sum which was negligible in 1954 has now merely to be multiplied by three, and three times negligible is something very small.

Dr. King: Hear, hear.

Mr. Cronin: If the Financial Secretary can see his way to implement the Clause,


preferably in full or even, possibly, in part, to give some relief to the unfortunate people concerned, it would not only be a source of great satisfaction to the Committee but would certainly raise the status of the Chancellor, of the Financial Secretary and of their party. It would have no inflationary effect worth talking about and one feels quite certain that our steady ascent up our present glacier to the plateau of stability would not be impeded even to a minimum extent.
The Government's acceptance of the Clause would certainly have a strong psychological effect. It would indicate to the country as a whole that, although the Government are prepared to take drastic steps to deal with our inflationary difficulties, they are prepared to make exceptions for those who most require preferential treatment. I hope, therefore, that the Financial Secretary will give the Clause very careful consideration, and will help a class of person whose case is justifiable beyond all doubt.

5.15 p.m.

Mr. A. E. Cooper: I think that everybody in the Committee has the greatest sympathy with the purpose behind the new Clause, but that many of us would doubt whether it was the right way of giving this relief to this class of people whom we all want to help.
The hon. Member for Loughborough (Mr. Cronin) referred to the small amount of money involved in this concession. It seems to me that if the sum is so small, its practical value to the people we want to help would equally be negligible, and on that ground alone I think that the Clause must fall.

Mr. Cronin: Is the hon. Member seriously suggesting that because the amount involved to the Exchequer is negligible, it must therefore be negligible to the persons it would benefit?

Mr. Cooper: I hope to show in a moment that that is so.
In my constituency, I take a considerable interest in the local spastics organisation. Practically all the members—the mothers and fathers—are what I would call members of the wage-earning class, almost 100 per cent. so. I would say also that by reason of the concessions which

have been granted over the past few years, the great majority of the members are people who pay little or no Income Tax, and yet these are the people who are hardest hit when their family is inflicted with a spastic child.
Although we all want to help them considerably, what would happen if the Clause was passed would be that the family with the highest income and which had a spastic child would get relief—and quite a bit of relief—whereas the family with the smallest income, which paid no tax whatever but still had the burden of a spastic child, would get no financial help whatever from the Exchequer. It seems to me that that torpedoes the whole of the arguments in favour of the Clause.
What we must do is to recognise that this is a very special class of people whom we have to help, and we have to help them in some form in a direct way so that each receives direct financial benefit in consequence of this dreadful disability.

Mrs. Eirene White: I find it difficult to follow the logic of the hon. Member for Ilford, South (Mr. Cooper), unless he is arguing that there should be no allowances whatever for Income Tax purposes. If the hon. Member seriously argues that, his argument would logically follow; but unless he suggests that there should be no allowances for special circumstances of various groups of taxpayer, I do not follow why he says that this concession is one which we ought not to support. Naturally, it does not preclude us from supporting other more positive measures which would help people who are in this unfortunate position with some special form of allowance for incapacity or something of that nature; but that is not what we are discussing today.
What we are discussing this afternoon is simply a particular concession within the realms of Income Tax. As the hon. Member himself admitted, it would be of some assistance to those who would be affected, and it seems to me that this is a reasonable suggestion, particularly because of the anomalies which now arise. As long as these various allowances exist we should try to see that there is a measure of justice in their operation. As my hon. Friend properly pointed out, it does seem anomalous that a parent of a child who is able to go to school and


continue education can claim the full child allowance, but that a parent of an incapacitated child can claim the allowance only if the child is able to go to some special establishment—and that depends, not only on the condition of the child, but on the locality in which the child lives.
In my constituency I have a number of cases of this kind. Not all of them, admittedly, would be covered by the new Clause, because the parents are not paying Income Tax, but there are some who would be covered. It depends, however, on whether the facilities are available. The arrangements for dealing with children vary throughout the country, and they are especially difficult in the rural areas, because of the distances between spastic centres and people's homes. As it happens, I have today had a letter from the Medical Officer of Flintshire, pointing out the cost of taking a spastic child to the nearest urban centre where daily training and education is available.
It seems extremely unfair that the sum of the concession should drop from £100 to £60 for the parent of a child who, through no fault of his own, cannot go to a place of full-time education, and who might even be able to benefit by the education, could he do so, and that the reduction should be at the age of 16, just at the time when the expenditure on that child, as on any other child, is apt to increase. We ought particularly to support the new Clause because there are these anomalies between one group and another.

Dr. King: I would agree with the hon. Member for Ilford, South (Mr. Cooper) that this is a minor proposal, and that those of us who share his interest in spastic children look forward to the day when there will be great reforms and much greater assistance given by the State to parents who have incapacitated children. However, that is no reason why we should not, by this Bill, in the meantime give them some help.
I am sure that the hon. Member will agree that mental backwardness and spasticity and epilepsy are not confined to the working classes or to people with low incomes, and if we have a chance by a Finance Bill to help, however slightly, one little group we should take that chance, and I should have thought, knowing his keen interest in the problems

of spasticity, that he would have been supporting us now.
This new Clause is the least costly and about the most worthy minor improvement we could make to the Bill. Under Section 212 (1) of the Income Tax Act, 1952, parents whose children after the age of 16 receive further education in a grammar school or university get relief at the standard rate on £100, and everyone in the Committee would agree that it is right that that should be so. Further education means a heavy burden on the parents whose children are receiving it. Let us consider how extensive that concession is. Not only do the parents get the tax concession on £100 but a child concerned is allowed to have an income of £85 a year, in his own right, which is exempt from tax.
However, spastics and epileptic children at the age of 16 are classed as dependants. Some of the children we are speaking of in this debate never get up from their beds, and some of them can never stand, and obviously do not go on with their schooling, and the worst of them have never been to school at all. This group of children at the age of 16 are classed as dependants, and in their case there is dependant's relief of £60, compared with the relief of £100 given to the parents of the brilliant child.
The relief we give to the parents of incapacitated children ought to be the same as that which we give to the parents of the children going to the university. They do not start earning money at that age. They continue their full-time education at home, where it has always been, under the devoted ministration of father and mother.
The parents of incapacitated children seem to get the worst of both worlds. The dependant's allowance itself is a smaller one than is the child allowance up to the age of 16, £60 compared with £100, because the assumption is that the dependant may not be entirely dependent. Indeed, the law permits a dependant to earn or have an income of some £85 a year, but by no stretch of the imagination can the incapacitated child be thought to be able to contribute to his own independence anything like £85 a year.
Such a child is helpless and a complete liability to his parents, and, as my hon.


Friend the Member for Flint, East (Mrs. White) has said, at the time when he becomes more of a financial burden, at about the age of 16, far from the concession being increased, it drops to £60. Indeed, up to last Friday the whole allowance disappeared at the school-leaving age. As I said on Friday, I hope that an improvement will today be made in this Bill in keeping with that which was effected last Friday in the family allowances.
These helpless children, from the age of 16 to 21, are at their most burdensome to their parents, physically, mentally, and economically. If a child is not too helpless, he goes to a special school. Here is the paradox, that if a child is not sufficiently mentally backward to be kept at home but can go to a special school the Income Tax concession which is given to the brilliant child is given to that child, too, because he is getting full-time instruction. The education of the worst spastics must take place at home.
Some of our backward children are incapacitated children who by no stretch of the imagination could be thought likely to succeed in going to a special school, no matter how many special schools there might be. Many children do not go to special schools, not because they are not suitable for special schools, not because their parents do not want to send them, but because the accommodation of such special schools is insufficient. Therefore, they are being penalised at the moment for the failure of the State to provide enough special schools for various forms of incapacity.
5.30 p.m.
Moreover, as I pointed out in a debate some years ago, some mothers will not let their children go to a special school. I admire these mothers of England who spend 24 hours a day looking after some helpless child, helpless even to manhood, with father and mother continuing these devoted services as long as the child is alive. I think sometimes that they are carrying a burden which is too great for them.
Some mothers might be persuaded, as I have succeeded in doing occasionally, to take the plunge and let the child go to a special school. If there is such a special school available, it is best for

the child to go there, but if the incapacitated child stays at home, then, on top of the burden voluntarily assumed by the loving affection of this type of parent, we ought not to retain an extra financial burden. National Assistance looks after the children of poor parents to some extent, but we cannot concern ourselves about that matter in connection with this debate. What we are seeking to do by means of the Clause, either in its present form or in some similar words, is to help that group of parents of incapacitated children who pay Income Tax.
When we discussed this matter on 29th June, 1954, the then Economic Secretary to the Treasury said:
When we come to consider … the recommendations of the Royal Commission here,"—
that is the recommendation relating to these cases—
quite clearly is one with a strong claim on our sympathies.
He then went on to mention some of the anomalies which my hon. Friend the Member for Loughborough (Mr. Cronin) mentioned in his able speech; but having discussed them he added:
I am not putting forward these arguments as reasons for rejecting the hon. Member's main principle."—[OFFICIAL REPORT, 29th June, 1954; Vol. 529, c. 1141–2.]
He pointed out that the cost was negligible.
Indeed, as I interrupted my hon. Friend to point out, the £1 million to £1½ million mentioned there was not the cost of this proposed new Clause but of this proposal plus a much more expensive new Clause relating to apprenticeship. The cost is really negligible and the Chancellor could please every hon. Members, even, on second thoughts, the hon. Member for Ilford, South, if he made this concession today.
The new Clause, in spirit if not in words, echoes what the Royal Commission on the Taxation of Profits and Income said in its Second Report:
… we recommend that a person who is receiving a child allowance in respect of an incapacitated child when it attains 16 should be entitled to the same figure of allowance for the intervening years until it attains 21.…
I beg the Minister at least to go as far as that if he will not go as far as accepting the whole implications of the new Clause.

The Financial Secretary to the Treasury (Mr. Henry Brooke): The boys and girls to whom the new Clause refers engage the sympathies of all of us. Many of us know homes which are darkened by one of these tragedies and I am grateful to the hon. Member for Loughborough (Mr. Cronin) for the very reasonable way in which he moved the Second Reading of the new Clause. I think that he recognised that this is yet another aspect of a problem which has been debated on many previous Finance Bills under different Governments—the question whether we can use the system of tax relief to assist the disabled or incapacitated.
I am sure that the hon. Member recognised, though I am not quite certain whether all hon. Members who spoke did so, that the proposal in the Clause is quite distinct from the recommendation in the Royal Commission's Report. The Clause would bring into existence what we have never had before, as far as I am aware, in our Income Tax law, that is a separate rate of child allowance for certain children.
Hitherto, the child allowance has always been a flat rate for each child, whatever the circumstances. It has been a flat rate regardless of the differing expenditure on their children by different parents, regardless of the differing expenditure by parents on different children in the same family, and indeed, regardless of differing expenditure on the same child at different ages. Many of us who have children know that the cost falling upon the parents does not remain the same throughout the children's boyhood or girlhood.
The proposed new Clause would give a rate of child allowance for totally incapacitated children 50 per cent. higher than the normal rate. The moment we say that we have to examine further all the border line cases or unfairness of application which we might get into if a scheme like this were adopted. I think that it has been recognised in Committee on previous Finance Bills, when we have been discussing this disablement question, that it is not just a matter of fulfilling the natural sympathies of all of us. What we have to do in the whole of our tax law is to avoid creating fresh anomalies or unfairness.
The scope of the proposal is clearly defined in the Clause. It would have the effect of giving substantial relief in a certain number of cases while denying any relief at all in a number of other cases where it might well be argued that there was just as great need. Whereas the Clause would give tax relief on £150 for a child who is entirely incapacitated by illness, infirmity or disablement, there are many parents who put themselves to very considerable expense in trying to save their children from going down to this class of total incapacity, and yet those people, though undergoing that substantial expenditure wholly for the benefit of their child, would gain nothing from the Clause and would feel discriminated against.
Moreover, we have to bear in mind other families who have been mentioned by more than one hon. Member. There is the type of child who is mentally retarded but not ineducable. The point was made that there might not be a special school in the neighbourhood to which the child could be sent, but we all know that there are parents who put themselves to considerable expense to send such a child to some school, at which they have to pay fees for the child to be looked after and educated as far as education is possible. In that case of additional expenditure, so falling upon the parent, the proposed new Clause would do nothing.
We would also have to concentrate on the arrangements which would have to be made for medical assessment, because one of the features of our tax law is that we must be precise and we must know who is to be entitled to the relief and who is not. I would not suggest that the problem of medical assessment would be as difficult or as complicated in this case as in the case of the new Clause which we debated last week. Nevertheless, it would not be wholly easy and, in particular, one has to bear in mind that the Clause would give the total relief in only a case of what one might call 100 per cent, incapacity.
There are many children who are handicapped. They are not able to live fully normal lives, they have not full earning capacity, and they may be able to do very little, but no one would claim that their incapacity amounted to 100 per cent. It would seem strange if nothing


at all were done for them, whereas full tax relief were granted for the children in whose case there is 100 per cent. incapacity.

Dr. King: I am grateful to the Minister for giving way. First he has spoken about the parents who, at great sacrifice, send their child to a special school and continue its education until the age of 16. That is recognised by the law at the present moment, and such a parent would get £100 Income Tax concession. The Minister was suggesting that what we are proposing to do is to give £150 tax concession to the parents with the badly disabled child at home but nothing for the other one, when they are getting £100 already.

Mr. Brooke: If I said nothing, it was a slip of the tongue. I meant nothing extra by this proposed Clause, which would give £150 in the case of the child who stayed at home, whereas if a child were sent away to school the existing tax relief of £100 would be granted.
The hon. Member for Loughborough begged me not to rely on the argument that the increased allowance would do little or nothing for parents who pay little or no tax. It is only right, however, that this aspect of the matter should be mentioned, especially as it was he himself who said that the beneficiaries of his proposed Clause are the children themselves and not the parents. He himself recognised that the beneficiaries of the Clause would be only one section of the children for whom he was speaking, and those children whose parents were not within the Income Tax range would gain nothing thereby. Reference has been made to the apparent arbitrariness of the age of 16, and I grant at once that the Royal Commission made a definite recommendation. However, the age of 16 is not quite as arbitrary as is commonly supposed, and I am not wholly sure that the Royal Commission had the full picture in mind when it made the recommendation.
The hon. Gentleman the Member for Southampton, Itchen (Dr. King) said that National Assistance was available in the case of the children of poor parents, and he implied that this was not available otherwise. I am advised that this is not the

case. I am advised that the National Assistance Board will accept an application at or over the age of 16, from or on behalf of a wholly incapacitated child with no capital or income of its own for an assistance grant in its own right regardless of the resources of its parents.
I do not want to urge that any parents should apply for National Assistance who feel strongly that it would be wrong for them to do so. Nevertheless I hope that both sides of the Committee accept that there is nothing degrading about applying for National Assistance, and it is fair for me to point out from this box that parents with incapacitated children over the age of 16 have the right to apply to the National Assistance Board if they think fit to do so.
5.45 p.m.
What I have just said reinforces the fact that if there is real need direct provision of that kind, or through the other social services, will give help with much greater precision than any tax relief can do. In the earlier part of my speech I have sought to indicate that neither this proposed Clause, nor any Clause drafted on similar lines, can give tax relief in all the cases where a legitimate and substantial claim can be made for it. As I said on a previous Clause, to help the disabled by tax relief is bound to be a hit or miss method. Therefore, though I have the greatest sympathy for the families on whose behalf this plea has been made, I must advise the Committee that to grant a tax relief of the kind proposed would not be the best way of helping them.

Mr. Jay: The reply of the Financial Secretary is disappointing. After all, a very small sum of money is involved here. On the previous new Clause the Chancellor could argue with some force that what we were asking for, though desirable, would have cost £32 million, which would have made a large hole in his Budget. The amount concerned here, however, is inconsiderable, and in spite of what the Financial Secretary said, there is an indefensible anomaly in the present law. It is a double anomaly, and nothing the hon. Gentleman said has disproved this.
In the first case, for the individual child there is an allowance of £100 up to the age of 16, and it falls to £60 after that age. One can have one child over the


age of 16 for whom there is an allowance of £100 and another child, because he is incapacitated and cannot go to school, for whom there is an allowance of £60. Indeed, there could be twins, one of whom suffered from these disabilities. The same allowance would be made for both up to the age of 16, but from that age onwards the allowance for the incapacitated twin would be only £60 and for the other it would still be £100. That is indefensible.
I am not persuaded that any satisfactory answer has been given, either by the Financial Secretary or by the hon. Gentleman the Member for Ilford, South (Mr. Cooper). The latter said that because the amount involved was small, it could not be of much use to the children or parents concerned. That is an absurd argument, because if the number of people we are dealing with is comparatively small, it can mean a lot to them and not a great deal to the Exchequer.
The hon. Member for Ilford, South and the Financial Secretary then argued that the proper way to deal with this matter was not through tax relief but through the social services. That is rather a strange argument coming from hon. Gentlemen opposite, namely, that the proper way to give relief to Income Tax payers is through National Assistance rather than through relief of Income Tax. Of course we on this side of the Committee are not arguing that this is the only action which ought to be taken. We feel strongly that help should be given through the social services to those below the Income Tax level. But if those are the views of the hon. Member for Ilford, South, I hope that he will not vote in favour of cuts in the National Health Service in a few weeks' time.
It seems to me that the right solution is to move forward on both fronts. As my hon. Friend the Member for Loughborough (Mr. Cronin) said, we cannot accept the doctrine that we should never make any increase in an Income Tax allowance because there are some people who will not get it, or that we should never correct any anomalies within the Income Tax itself. The Royal Commission accepted that argument and applied it to the proposals now before us.
I agree with the Financial Secretary that it might not be the ideal solution to have a higher child allowance for these people than the ordinary child allowance, but the hon. Gentleman will recall that

when we put this proposed Clause down we were seeking to raise the existing child allowance above £100. I should be satisfied if the hon. Gentleman would agree to accept the proposal that the allowance for the incapacitated child above the age of 16 should be equal to the present child allowance. If the right hon. Gentleman is unwilling even to do that, I hope that my hon. Friends will not withdraw the Motion.

Mr. Percy Collick: I have listened with profound disappointment to the Financial Secretary. His argument was particularly weak. I suspect that it is not easy to stand at the Dispatch Box and reject a Clause which, on its merits, the Committee ought to accept. The Clause proposes that a concession of tax on £150 shall be given to a person maintaining a totally disabled child. I should have thought that an eminently reasonable suggestion. The Financial Secretary probably thinks so, too. However, the Treasury has decided to oppose the Clause.
The right hon. Gentleman's argument seemed to be that the Committee should not accept the Clause because, if it did, there would be children 80 per cent. disabled who would not get the benefit of it. If the Committee cannot persuade the Government to give a concession for 100 per cent. disablement, what hope has it of getting the Government to give a concession for 80 per cent. disablement? Surely an adjustment could easily be made for 80 per cent. disablement in order to meet the case that we have in mind.
One of my constituents is nursing a daughter who is dying of tuberculosis. This poor woman also suffers the handicap of having in the house an imbecile child of seventeen who, because of the shortage of accommodation for mentally defective children, cannot be housed by the public authority. I am sure that the whole Committee will have sympathy with the woman handling that situation. Why cannot the father have the benefit of the £150 concession to meet the burden?
It is significant that every Amendment or new Clause moved by the Opposition to help disabled people has been rejected by the Government. I am not at all sure it is not time that our disabled people formed a pressure group as strong as


some of the pressure groups which operate on the Treasury. A number of our new Clauses and Amendments have been completely justifiable on their own merit, and they have also had behind them recommendations by the Royal Commission. We have had no argument from the right hon. Gentleman except that the concession cannot be given for the 100 per cent. disabled because there are children who are 80 per cent. disabled who would not benefit from it.

Mr. H. Brooke: The Royal Commission said nothing at all on those lines. It never suggested a child allowance higher than the normal one.

Mr. Collick: My hon. Friend the Member for Southampton, Itchen (Dr. King) quoted from the Royal Commission's Report on this point.

Dr. King: The Committee should not become confused about this point. The Minister is right when he says that the Royal Commission did not recommend what is contained in our new Clause. Our Clause proposes a tax allowance on £150 for a child. However, the passage which I read from the Royal Commission's Report justifies the Minister giving way to the plea of my right hon. Friend the Member for Battersea, North (Mr. Jay) that he should at least give the incapacitated child the £100 allowance which is given to the other children.

Mr. Collick: If my hon. Friend the Member for Itchen is right, the difference is as between £100 and £150, I am sorry if I was £50 wrong. I am certain the Committee would welcome a concession of £100 even if we cannot have £150. If the Financial Secretary can say that the Government will concede an allowance of £100, which is in harmony with the Royal Commission's Report, well and good. I am sure that my hon. Friends would be very ready to accept it. I urge the Government to do something to meet our case. Throughout the Finance Bill we have had nothing but negative replies from the Treasury Bench. In this case we ought to have had an affirmative reply.

Mr. John Hall: I have listened to the arguments from the Opposition with a great deal of sympathy. My wife and I have been for some time closely associated with organisations dealing with spastic children, backward children and those

suffering from infantile paralysis. I have come into close contact with a number of real family tragedies. I should have thought that there was a good case, if not for accepting the new Clause, then for going as far as conceding an allowance of £100.
I realise that the Financial Secretary has a good deal on his side in some of the arguments which he has deployed against accepting the proposal. However, I hope that he and his right hon. Friend will look at the matter again and consider whether the £100 allowance can be extended to cover these cases. It would represent very much needed assistance and well deserved relief for some hard hit families. There are fairly few of these cases, and that is an argument in favour of giving way on the point. I hope that my right hon. Friend will reconsider it before Report.

Mr. Harold Wilson: I had not intended to intervene in this debate, but surely the right hon. Gentleman will not leave unanswered the moving plea by his hon. Friend the Member for Wycombe (Mr. John Hall) in support of what has been said by my hon. and right hon. Friends. In view of the very small amount of revenue involved—it is negligible—cannot the right hon. Gentleman tell us that he will bring the matter to the attention of his right hon. Friend, reconsider it with as much sympathy as the Treasury is capable of showing towards a case of this kind, and perhaps bring forward new proposals on Report? Cannot he at least give us that hope?

Mr. H. Brooke: I hope the right hon. Member for Huyton (Mr. H. Wilson) will not charge the Treasury with lack of sympathy. He must know perfectly well that neither Treasury Ministers nor Treasury officials have any lack of sympathy. What we have to do is to administer, with as much justice as possible, the tax law laid down by Parliament.
I will certainly bring to the notice of my right hon. Friend what has been said. I cannot hold out any hope that there will be changes in this year's Finance Bill on the lines suggested, but we will examine the matter further. The right hon. Gentleman will grant that what I have had to do is to address myself to the Clause before the Committee and not to some other Clause which might have


been tabled. For the reasons which I have explained, I must advise the Committee not to accept the Clause.

Mr. H. Wilson: I must point out to the right hon. Gentleman that we are talking about Treasury Ministers and not Treasury officials. I am sure Treasury officials would show as much sympathy as possible if Ministers would let them. In the Committee, Treasury Ministers alone are responsible, as I am sure the right hon. Gentleman would be the first to agree.
6.0 p.m.
The right hon. Gentleman made no attempt to defend the Government's hardhearted attitude in terms of the Revenue. It is, as he said, a question of tax law, which has to be just and fair all round, which is in his mind. As my hon. Friends have made clear, the Report of the Royal Commission dealt with this matter and the Commission spent a great deal of time going into it. I agree that the new Clause does not follow word for word the recommendations of the Commission. If the right hon. Gentleman had said that that was his only objection to the new Clause and that he was prepared to accept the Royal Commission's recommendation

and would ask his right hon. Friend on Report to bring forward something to that effect, we should have been satisfied.

We get some crumb of satisfaction in that he will bring to his right hon. Friend's attention what has been said. That does not take us much further forward. Surely everything which is said in the debates on the Finance Bill in the interstices when the Chancellor cannot be with us is brought to his attention. We must assume that the Chancellor reads in HANSARD everything which is said when he is not present. If we cannot make that assumption, we must press for the Chancellor to be here all the time. It is not much of a concession if the right hon. Gentleman says that he will underline words in HANSARD when the Chancellor reads them. If that is the only concession, we must divide the Committee in order to make it clear that we hope that the Government will make this concession in the autumn Budget, or in the next Budget whenever it may be.

Question put, That the Clause be read a Second time:—

The Committee divided: Ayes 193, Noes 244.

Division No. 231.]
AYES
[6.1 p.m.


Ainsley, J. W.
Cronin, J. D.
Herbison, Miss M.


Albu, A. H.
Grossman, R. H. S.
Hewitson, Capt. M.


Allaun, Frank (Salford, E.)
Darling, George (Hillsborough)
Hobson, C. R.


Allen, Arthur (Bosworth)
de Freitas, Geoffrey
Holman, P.


Allen, Scholefield (Crewe)
Delargy, H. J.
Holmes, Horace


Anderson, Frank
Dodds, N. N.
Holt, A. F.


Bacon, Miss Alice
Donnelly, D. L.
Howell, Charles (Perry Barr)


Bellenger, Rt. Hon. F. J.
Dugdale, Rt. Hn. John (W. Brmwch)
Hubbard, T. F.


Benson, G.
Dye, S.
Hughes Cledwyn (Anglesey)


Beswick, F.
Ede, Rt. Hon. J. C.
Hughes, Emrys (S. Ayrshire)


Blackburn, F.
Edelman, M.
Hunter, A. E.


Blenkinsop, A.
Edwards, Rt. Hon. John (Brighouse)
Irving, S. (Dartford)


Blyton, W. R.
Edwards, Rt. Hon. Ness (Caerphilly)
Isaacs, Rt. Hon. G. A.


Boardman, H.
Edwards, Robert (Bilston)
Janner, B.


Bottomley, Rt. Hon. A. G.
Evans, Albert (Islington, S.W.)
Jay, Rt. Hon. D. P. T.


Bowden, H. W. (Leicester, S.W.)
Evans, Edward (Lowestoft)
Jeger, George (Goole)


Bowen, E. R. (Cardigan)
Fienburgh, W.
Jeger, Mrs. Lena (Holbn &amp; St. Pnes, S.)


Bowles, F. G.
Finch, H. J.
Johnson, James (Rugby)


Boyd, T. C.
Forman, J. C.
Johnston, Douglas (Paisley)


Braddock, Mrs. Elizabeth
Fraser, Thomas (Hamilton)
Jones, Rt. Hon. A. Creech (Wakefield)


Brockway, A. F.
Gaitskell, Rt. Hon. H. T. N.
Jones, Elywyn (W. Ham, S.)


Broughton, Dr. A. D. D.
Gibson, C. W.
Jones, J. Idwal (Wrexham)


Brown, Rt. Hon. George (Belper)
Gordon Walker, Rt. Hon. P. C.
Jones, T. W. (Merioneth)


Brown, Thomas (Ince)
Greenwood, Anthony
Kenyon, C.


Butler, Herbert (Hackney, C.)
Grey, C. F.
Key, Rt. Hon. C. W.


Butler, Mrs. Joyce (Wood Green)
Griffiths, David (Rother Valley)
King, Dr. H. M.


Callaghan, L. J.
Griffiths, Rt. Hon. James (Llanelly)
Lawson, G. M.


Castle, Mrs. B. A.
Griffiths, William (Exchange)
Lewis, Arthur


Chapman, W. D.
Grimond, J.
Lindgren, G. S.


Chetwynd, G. R.
Hale, Leslie
Lipton, Lt.-Col. M.


Clunie, J.
Hamilton, W. W.
Logan, D. G.


Coldrick, W.
Hannan, W.
Mabon, Dr. J. Dickson


Collick, P. H. (Birkenhead)
Harrison, J. (Nottingham, N.)
McGhee, H. G.


Collins, V. J. (Shoreditch &amp; Finsbury)
Hastings, S.
McInnes, J.


Corbet, Mrs. Freda
Hayman, F. H.
McKay, John (Wallsend)


Cove, W. G.
Healey, Denis
McLeavy, Frank


Craddock, George (Bradford, S.)
Henderson, Rt. Hn. A. (Rwly Regis)
Mahon, Simon




Mallalieu, E. L. (Brigg)
Probert, A. R.
Summerskill, Rt. Hon. E.


Mallalieu, J.P.W. (Huddersfield, E.)
Proctor, W. T.
Taylor, Bernard (Mansfield)


Mann, Mrs. Jean
Pryde, D. J.
Taylor, John (West Lothian)


Marquand, Rt. Hon. H. A.
Randall, H. E.
Thomson, George (Dundee, E.)


Mason, Roy
Rankin, John
Tomney, F.


Mayhew, C. P.
Redhead, E. C.
Turner-Samuels, M.


Messer, Sir F.
Reeves, J.
Warbey, W. N.


Mikardo, Ian
Reid, William
Weitzman, D.


Mitchison, G. R.
Robens, Rt. Hon. A.
Wells, Percy (Faversham)


Monslow, W.
Roberts, Albert (Normanton)
Wells, William (Walsall, N.)


Moody, A. S.
Roberts, Goronwy (Caernarvon)
West, D. G.


Morrison,Rt.Hn.Herbert(Lewis'm,S.)
Robinson, Kenneth (St. Pancras, N.)
Wheeldon, W. E.


Moyle, A.
Rogers, George (Kensington, N.)
White, Mrs. Eirene (E. Flint)


Neal, Harold (Bolsover)
Ross, William
White, Henry (Derbyshire, N.E.)


Noel-Baker, Rt. Hon. P. (Derby, S.)
Royle, C.
Wilkins, W. A.


Oliver, G. H.
Short, E. W.
Williams, Rev. Llwelyn (Ab'tillery)


Oram, A. E.
Shurmer, P. L. E.
Williams, Rt. Hon. T. (Don Valley)


Orbach, M.
Silverman, Julius (Aston)
Williams, W. R. (Openshaw)


Oswald, T.
Simmons, C. J. (Brierley Hill)
Williams, W. T. (Barons Court)


Paling, Rt. Hon. W. (Dearne Valley)
Slater, Mrs. H. (Stoke, N.)
Willis, Eustaoe (Edinburgh, E.)


Paling, Will T. (Dewsbury)
Slater, J. (Sedgefield)
Wilson, Rt. Hon. Harold (Huyton)


Palmer, A. M. F.
Smith, Ellis (Stoke, S.)
Woodburn, Rt. Hon. A.


Parker, J.
Snow, J. W.
Woof, R. E.


Parkin, B. T.
Sorensen, R. W.
Yates, V. (Ladywood)


Paton, John
Sparks, J. A.
Younger, Rt. Hon. K.


Pearson, A.
Stones, W. (Consett)
Zilliacus, K.


Peart, T. F.
Strachey, Rt. Hon. J.



Price, J. T. (Westhoughton)
Stross,Dr.Barnett(Stoke-on-Trent,C.)
TELLERS FOR THE AYES:


Price, Philips (Gloucestershire, W.)

Mr. Short and Mr. Deer.




NOES


Allan, R. A. (Paddington, S.)
Donaldson, Cmdr. C. E. McA.
Hornby, R. P.


Alport, C. J. M.
Doughty, C. J. A.
Hornsby-Smith, Miss H. P.


Amery, Julian (Preston, N.)
du Cann, E. D. L.
Horobin, Sir Ian


Amory, Rt. Hn. Heathcoat (Tiverton)
Dugdale, Rt. Hn. Sir T. (Richmond)
Howard, Hon. Greville (St. Ives)


Anstruther-Gray, Major Sir William
Duncan, Capt. J. A. L.
Howard, John (Test)


Arbuthnot, John
Duthie, W. S.
Hudson, Sir Austin (Lewisham, N.)


Armstrong, C. W.
Eccles, Rt. Hon. Sir David
Hughes, Hallett Vice-Admiral J.


Ashton, H.
Eden, J. B. (Bournemouth, West)
Hughes-Young, M. H. C.


Atkins, H. E.
Elliot, Rt. Hon. W. E.
Hulbert, Sir Norman


Baldock, Lt.-Cmdr. J. M.
Emmet, Hon. Mrs. Evelyn
Hutchison, Sir Ian Clark (E'b'gh,W.)


Baldwin, A. E.
Errington, Sir Eric
Hylton-Foster, Sir H. B. H.


Balniel, Lord
Erroll, F. J.
Iremonger, T. L.


Banks, Col. C.
Farey-Jones, F. W.
Irvine, Bryant Godman (Rye)


Barter, John
Fell, A.
Jenkins, Robert (Dulwich)


Baxter, Sir Beverley
Finlay, Graeme
Jennings, J. C. (Burton)


Beamish, Maj. Tufton
Fort, R.
Johnson, Dr. Donald (Carlisle)


Bell, Philip (Bolton, E.)
Freeth, D. K.
Johnson, Eric (Blackley)


Bell, Ronald (Bucks, S.)
Gammans, Sir David
Johnson, Howard (Kemptown)


Bevins, J. R. (Toxteth)
Garner-Evans, E. H.
Jones, Rt. Hon. Aubrey (Hall Green)


Biggs-Davison, J. A.
George, J. C. (Pollok)
Joseph, Sir Keith


Bishop, F. P.
Gibson-Watt, D.
Keegan, D.


Black, C. W.
Glover, D.
Kerby, Capt. H. B.


Body, R. F.
Godber, J. B.
Kerr, H. W.


Boothby, Sir Robert
Gough, C. F. H.
Kershaw, J. A.


Bossom, Sir A. C.
Gower, H. R.
Kimball, M.


Boyd-Carpenter, Rt. Hon. J. A.
Graham, Sir Fergus
Kirk, P. M.


Boyle, Sir Edward
Grant, W. (Woodside)
Lagden, G. W.


Braine, B. R.
Grant-Ferris, Wg Cdr. R. (Nantwich)
Lambert, Hon. G.


Braithwaite, Sir Albert (Harrow, W.)
Green, A.
Lancaster, Col. C. G.


Bromley-Davenport, Lt.-Col. W.H.
Gresham Cooke, R.
Langford-Holt, J. A.


Brooke, Rt. Hon. Henry
Grimston, Hon. John (St. Albans)
Leather, E. H. C.


Brooman-White, R. C.
Grimston, Sir Robert (Westbury)
Leavey, J. A.


Browne, J. Nixon (Craigton)
Gurden, Harold
Legge-Bourke, Maj. E. A. H.


Buchan-Hepburn, Rt. Hon. P. G. T.
Hall, John (Wycombe)
Legh, Hon. Peter (Petersfield)


Bullus, Wing Commander E. E.
Hare, Rt. Hon. J. H.
Lindsay, Hon. James (Devon, N.)


Butcher, Sir Herbert
Harris, Frederic (Croydon, N. W.)
Lindsay Martin (Solihull)


Campbell, Sir David
Harris, Reader (Heston)
Linstead, Sir H. N.


Cary, Sir Robert
Harrison, A. B. C. (Maldon)
Lloyd Maj. Sir Guy (Renfrew, E.)


Channon, H.
Harrison, Col. J. H. (Eye)
Low, Rt. Hon. A. R. W.


Cole, Norman
Harvey, Air Cdre. A. V. (Macclesfd)
Lucas, Sir Jocelyn (Portsmouth, S.)


Conant, Maj. Sir Roger
Harvey, Ian (Harrow, E.)
Lucas, P. B. (Brentford &amp; Chiswick)


Cooper-Key, E. M.
Harvey, John (Walthamstow, E.)
Lucas-Tooth, Sir Hugh


Cordeaux, Lt.-Col. J. K.
Harvie-Watt, Sir George
McAdden, S. J.


Corfield, Capt. F. V.
Hay, John
Macdonald, Sir Peter


Crouch, R. F.
Heald, Rt. Hon. Sir Lionel
McKibbin, A. J.


Crowder, Sir John (Fin[...]hley)
Heath, Rt. Hon. E. R. G.
Mackie, J. H. (Galloway)


Crowder, Petre (Ruislip—Northwood)
Henderson, John (Cathoart)
McLaughlin, Mrs. P.


Cunningham, Knox
Hill, Rt. Hon. Charles (Luton)
Maclay, Rt. Hon. John


Currie, G. B. H.
Hill, Mrs. E. (Wythenshawe)
McLean, Neil (Inverness)


Dance, J. C. G.
Hinchingbrooke, Viscount
Macmillan, Rt.Hn.Harold(Bromley)


Davidson, Viscountess
Hirst, Geoffrey
Macpherson, Niall (Dumfries)


D'Avigdor-Goldsmid, Sir Henry
Holland-Martin, C. J.
Maddan, Martin


Deedes, W. F.
Hope, Lord John
Maitland, Cdr. J. F. W. (Horncastle)




Maitland, Hon. Patrick (Lanark)







Manningham-Buller, Rt. Hn. Sir R.
Prior-Palmer, Brig. O. L.
Taylor, Sir Charles (Eastbourne)


Marples, A. E.
Profumo, J. D.
Taylor, William (Bradford, N.)


Mathew, R.
Raikes, Sir Victor,
Thomas, P. J. M. (Conway)


Maude, Angus
Ramsden, J. E.
Thompson, Kenneth (Walton)


Maudling, Rt. Hon. R.
Redmayne, M.
Thompson, Lt.-Cdr. R. (Croydon, S.)


Mawby, R. L.
Rees-Davles, W. R.
Thornton-Kemsley, C. N.


Maydon, Lt.-Comdr. S. L. C.
Remnant, Hon. P.
Tilney, John (Wavertree)


Medlicott, Sir Frank
Renton, D. L. M.
Touche, Sir Gordon


Milligan, Rt. Hon. W. R.
Ridsdale, J. E.
Turner, H. F. L.


Moore, Sir Thomas
Rippon, A. G. F.
Turton, Rt. Hon. R. H.


Morrison, John (Salisbury)
Robertson, Sir David
Vane, W. M. F.


Nabarro, G. D. N.
Robinson, Sir Roland (Blackpool, S.)
Vaughan-Morgan, J. K.


Nairn, D. L. S.
Roper, Sir Harold
Vickers, Miss J. H.


Neave, Airey
Schofield, Lt.-Col. W.
Wakefield, Edward (Derbyshire, W.)


Nicholson, Godfrey (Farnham)
Scott-Miller, Cmdr. R.
Walker-Smith, D. C.


Nicolson, N. (B'n'm'th, E. &amp; Chr'ch)
Sharples, R. C.
Wall, Major Patrick


Nield, Basil (Chester)
Shepherd, William
Ward, Hon. George (Worcester)


Nugent, G. R. H.
Simon, J. E. S. (Middlesbrough, W.)
Ward, Dame Irene (Tynemouth)


Oakshott, H. D.
Soames, Capt. C.
Waterhouse, Capt. Rt. Hon. C.


O'Neill, Hn. Phelim (Co. Antrim, N.)
Spearman, Sir Alexander
Webbe, Sir H.


Ormsby-Gore, Hon. W. D.
Spelr, R. M.
Whitelaw, W.S.I. (Ponrith &amp; Border)


Orr, Capt. L. P. S.
Spence, H. R. (Aberdeen, W.)
Williams, Paul (Sunderland, S.)


Osborne, C.
Spens, Rt. Hn. Sir P. (Kens'gt'n, S.)
Williams, R. Dudley (Exeter)


Page, R. G.
Stanley, Capt Hon. Richard
Wilson, Geoffrey (Truro)


Pannell, N. A. (Kirkdale)
Stevens, Geoffrey
Wood, Hon. R.


Peyton, J. W. W.
Steward, Harold (Stockport, S.)
Woollam, John Victor


Pilkington, Capt. R. A.
Steward, Sir William (Woolwich, W.)



Pitt, Miss E. M.
Studholme, Sir Henry
TELLERS FOR THE NOES:


Powell, J. Enoch
Summers, Sir Spencer
Mr. Wills and Mr. Barber.

New Clause.—(BLIND PERSONS.)

The following section shall be added to Part VIII of the Income Tax Act, 1952:
228A. If a claimant proves that during the whole of the year of assessment he has been a blind person on the register of blind persons maintained by the appropriate local authority under sub-paragraph (g) of subsection (4) of section twenty-nine of the National Assistance Act, 1948, he shall be

entitled to a deduction from the amount of income tax with which he is chargeable equal to tax at the standard rate on one hundred pounds".—[Mr. H. Wilson.]

Brought up, and read the First time.

Motion made, and Question put, That the Clause be read a Second time:—

The Committee divided: Ayes 192, Noes 245.

New Clause.—(EXEMPTION FROM ENTERMENTS DUTY OF GAMES AND SPORTS OTHER THAN HORSE RACING AND DOG RACING.)

(1) Entertainments duty shall not be chargeable in respect of entertainments which consist of games or sports other than entertainments consisting wholly or mainly of horse-races or dog-races.

(2) This section shall have effect, and be deemed to have had effect, as respect payments for admission to entertainments held on or after the sixth day of August, nineteen hundred and fifty-six, other than payments made before the sixth day of April in that year.

(3) In this section "horse-races" has the same meaning as in the Racecourses Licensing Act, 1879, and "dog-races" has the same meaning as in Part I of the Betting and Lotteries Act, 1934.—[Mr. Ellis Smith.]

Brought up, and read the First time.

Mr. Ellis Smith: I beg to move, That the Clause be read a Second time.

The Temporary Chairman (Sir Austin Hudson): I suggest that we should consider at the same time, the new Clause in the name of the hon. Member for Midlothian (Mr. Pryde), "Exemption of Highland Games from Entertainments Duty";


the new Clause in the name of the right hon. Member for West Bromwich (Mr. Dugdale), "Exemption of Association football matches from Entertainments Duty"; the new Clause in the name of the hon. Member for Keighley (Mr. Hobson), "Exemption of football matches (Rugby League) from Entertainments Duty"; the new Clause in the name of the right hon. and learned Member for Rowley Regis and Tipton (Mr. A. Henderson), "Exemption of ice hockey matches from Entertainments Duty"; the new Clause in the name of the hon. Member for Reading (Mr. Mikardo), "Reduction of Entertainments Duty on football and boxing receipts up to £2,000"; and the new Clause in the name of the hon. and gallant Member for Knutsford (Lieut.-Colonel Bromley-Davenport), "Scale of Entertainments Duty in case of boxing entertainment".
I am informed that it is proposed that a Division should be taken on the first five of those new Clauses; I believe that some such arrangement has been made.

Mr. Mitchison: On a point of order. Any question of Divisions would be contingent on the Government not accepting all the new Clauses. We hope that they will accept them.

The Temporary Chairman: That is so.

Mr. Ellis Smith: If I were asked to express my great desire at present it would be that the Chamber should be packed with hon. Members on both sides of the Committee, for our case is so unanswerable that if only we had an opportunity of reasoning with one another I am convinced that most reasonable hon. Members would be prepared to support it. Year after year we continue to receive increasing support, and if the logic of the previous Chancellor of the Exchequer is correct, it should mean that today the present Chancellor should accept these proposed new Clauses.
In the last General Election the party to which we belong stated in its Election manifesto that we should abolish the tax on sport played by men and women. We and the sporting community are very pleased to see that my right hon. Friend the Leader of the Opposition has stated since then that when we obtain power he will unhesitatingly implement the

promise made at the last General Election.
In every other country in the world sport is being encouraged. In this country we discourage it, for the Entertainments Duty is a tax of discouragement. I will today content myself with stating the general case, leaving it to my hon. Friends to state the special cases, based on their special interests in accordance with their constituencies. We are reinforced in the debate on this occasion by the fact that one of my hon. Friends has been appointed a first-class referee. I am sure that we all congratulate him upon his appointment.
In sport, as in many other things, success begets success. Our success has also reflected itself financially. In Manchester, we have won the League Championship, the Central League, the Under-18 Shield, the Youth League and the English F.A. Cup, and now we are well on the way to winning the Cricket Championship. Through success I have learned magnanimity, although in life generally, quite apart from success, magnanimity pays in human relations.
On this occasion, in particular, I can afford to take a big view and to speak nationally. I should have thought that most hon. Members would support us on this occasion, because it is admitted that the tempo of life in Britain is quickening, particularly in the industrial areas. Those hon. Members who are familiar with the life and especially with the industry of industrial areas will agree that the tempo is quickening.
This requires that people should keep fit, and in every other country in the world young men and women and middle-aged men and women have been encouraged to keep fit. Fitness enables people to play their parts in life better. It enables them to recover from illness more quickly than they otherwise would, as I know from a personal experience. It enables people to go about their work in a better frame of mind, and, therefore, they work better. This is a business proposition which I am putting forward tonight. If we are to keep our people fit, I submit that the time has arrived when this tax should be abolished.
Many of my hon. Friends often say to me in the Division Lobby and in the Library that they cannot understand why the Chairman of Ways and Means always


looks so fit. It has been my privilege to sit under many Chairmen of Ways and Means. One wore a monacle, and that used to provoke me, especially in the days before I mellowed to the extent that I have today. Another used to go to sleep. I remember that we used to have one another called by shouting out each other's names.
But Sir Charles always looks fit. He is always alert. Indeed, he is the most alert Chairman I have ever known, and he never rules an hon. Member out of order if the Member is not out of order. I only wish that more chairmen would remember that. The secret is that Sir Charles keeps himself fit as though he were a young man. He plays golf regularly. That is an example of how one can make a better contribution to life by keeping fit.
Most large employers—that is, those who make a wide approach to problems—have long since adopted this policy. They have welfare schemes of all kinds. They encourage sport. They go out of their way at annual meetings to congratulate the clubs and those who organise them. They realise that to get the best out of people in industry, a policy such as I am advocating must be adopted.
I am familiar with engineering and with the young men who are engaged in mining and research. They all have to keep fit. It was my privilege, a few months ago, to go down a modern pit for four hours. I was there told that when the men reached 45 years of age they could no longer tolerate the life because of the tempo in that pit and the fast methods of extracting coal. This life demands sport and relaxation, and we should encourage and cater for it. It is for that reason that we say there is an unanswerable case for this Clause.
In addition, the public spirit of our people is a quality that should be admired and encouraged. It is that and the voluntary energy that keeps our sports going. It was that spirit that built our friendly societies, trade unions and co-operative societies which are the admiration of the world. It is that spirit which enabled our young men in their Spitfires to reply to those who, in 1938 and 1939, charged us with being decadent. The "Strength through joy" merchants received their answer from our fit young men in 1940. Our young men of today should be receiv-

ing more encouragement than they are. They should not be discouraged by this tax.
I should like the Chancellor or the Financial Secretary to tell us of any other country that puts a tax on sport played by men and women. May I repeat that, in order that the Financial Secretary may make a note of it? If the Financial Secretary is to reply to this debate, will he tell us one other country that taxes sport played by men and women?
7.15 p.m.
I wish this Committee were packed with hon. Members. I do not want to make too much of it, but I have seen a great change in my time. I remember when, during the Committee stage of the Finance Bill, this Chamber used to be packed with Members. We used to reason with one another and, as a result, we were able to win Members over to our way of thinking. In the present circumstances, therefore, I suggest that this Committee should be on its guard.
If any hon. Member disagrees with the case that I am stating, I ask him to read the pages of any local newspaper. There, from the space that is devoted in local newspapers to local sporting activities, one will realise the value of catering for sport. Nowadays, because of the taxation on sport—I shall give the figures later—sport is being kept alive by many public-spirited men who pay out of their own pockets to keep the clubs going. This applies in Stoke-on-Trent at present. It applied to Manchester United, in 1930, when Mr. John Gibson put £50,000 into the club to enable it to carry on. The satisfaction that it gives to the teeming populations of that large industrial area proves that we ought to encourage the public spirit of men like Mr. John Gibson, who is no longer living.
Mr. John Gibson's life will live ever green in the memories of the toiling millions of that area. They realise what they owe to him. Very often when his sight was failing, Mr. Gibson would put his hand on my shoulder and say that it gave him great satisfaction to listen to the men and women enjoying themselves on a Saturday afternoon—50,000 and 60,000 of them from that large industrial area of Manchester.
I will give this credit to the previous Chancellor of the Exchequer. He used to listen to us for hours and hours. It


was obvious that we often won his sympathy. In 1953, cricket was exempted from the scope of the tax with effect from 27th April. Pleasure was expressed on both sides of the Committee. But if it was right to exempt cricket three years ago, surely the time has now arrived when all sport played by men and women in this country should be exempted, too. What was granted to cricket three years ago should be granted to all other games.
One of the points that the Chancellor made, when speaking in favour of the proposed exemption in the Finance Bill debate three years ago, was that there was a danger of cricket clubs going out of existence. The same applies to other sporting activities. Therefore, if the Chancellor's logic was correct three years ago—and most reasonable Members will admit that it was—then surely the time has arrived when this new Clause should be accepted.
In 1954, football paid in tax £1,640,000; in 1955, it paid £1,360,000. Arsenal alone paid in tax approximately £42,000 in 1953; Blackpool paid £19,000; Bolton, £17,500; Manchester City, £21,000; and Stoke City paid £6,000 in 1952, and £16,000 in 1953. The average for all clubs in the First Division was £23,800, and in the Second Division £13,000. That is the tax on the people's sport. That is the tax on relaxation in the industrial areas.
I ask the Financial Secretary whether it is the case that the Government, in reply to the Football Association, stated that Association football is not played by human beings. I have the minutes of the F.A. Council meeting here—and the Financial Secretary or the Chancellor can check up on them. These minutes say:
It was indeed a shock when the Government decided that Association football is not played by human beings. A remarkable difference was made between this game and other forms of live performances.
I would rather like to meet some of these legal people who have given this advice to the Government. It has been my privilege to work with some of the greatest legal people in this country, many of whom have made contributions from the Front Bench, and I would hesitate to enter into legal matters with them. It is becoming the practice in political quarters nowadays that legal people should deal with legal matters and that we should rightly keep out because we

are not legally trained; but when it comes to dealing with industrial matters or technical education the people who know a little about those matters are not debarred from taking part.
Nevertheless, we have learned that when it comes to a legal matter it is best to leave it to the legal authorities. [HON. MEMBERS: "No."] On this issue, I would have no hesitation in entering into debate or discussion with the best legal advisers that the Government can produce. [HON. MEMBERS: "Where is the Solicitor-General?"] For example, here is one question which the Financial Secretary might consider. We have playing cricket for Lancashire at present—and we look like becoming the champions—a young man named Dyson, who is a professional. I hope that no one thinks that there are not many amateurs in cricket, because I happen to know a few. This man happens to be a professional, and if he plays in a cricket match that match is exempted from Tax, but next August, and for the whole of the winter, he will be playing football for Manchester City and those matches will be taxed. Will the Chancellor explain an inconsistency of that kind?
I live in an area where there are more people living per square mile than in any part of the world. In that area, there are more sporting clubs than in any other part of the world. That is a tax on the people's sport. It is a tax on their relaxation, and we owe it to those men and women who are making such a mighty contribution to our export trade to encourage them in sport and relaxation. My hon. Friends will give evidence later of the financial worries that are caused by quoting some of them. The financial worries of the clubs in which men and women take part in sport are increasing. They should not have a tax imposed on their other difficulties.
My hon. Friend the Member for Coventry, South (Miss Burton) has written an ideal article in this month's Northern Voice on this problem, which I would recommend everyone to read. Almost every other country is encouraging its people with financial support in preparation for the Olympic Games. Our people are on their hands and knees begging for support. This is humiliating and ought not to be taking place.
We ought to modernise our outlook in accordance with the growing change


in the world outlook and take off this tax today. In addition, we ought to be encouraging young men and women who are going to the Olympic Games, rather than forcing them into the humiliating position of having to beg on their hands and knees. Many clubs as a result of this tax are now nearly out of existence.
The tax was taken off cricket three years ago and we now ask the Chancellor to accept this new Clause in order that we can do justice to the whole of sport played by men and women. Three years ago we were encouraged, and today we want a little more encouragement. We ask the Chancellor to accept this new Clause.

Lieut.-Colonel Bromley-Davenport: It gives me great pleasure to propose a reduction in the scale of taxation for boxing in accordance with the new Clause in my name and the names of hon. Members on both sides of the Committee. The object of this Clause is to reduce the tax on boxing to the same scale as that of the living theatre.
I have already spoken twice today. You, Sir Austin, did not have the felicity of hearing me on the first occasion. I feel, therefore, that I have had more than my share and I shall therefore be very brief. There is an hon. Member opposite bursting with a mine of information on this subject—throbbing with the desire to speak—the hon. Member for Leicester, North-West (Mr. Janner). Around me I see the usual hardy annuals, all longing to spring to their feet to talk about their favourite sport and to try to get a reduction. I ask them to be as brief as I intend to be, and then we may all be able to get home earlier tonight.
Boxing was a very popular sport prior to 1952. Since the increase in taxation, the total number of tournaments has decreased since 1952 by more than half and commercial boxing has decreased by well over half, and the decline continues. The effect of that is that practically all the smaller promotions are closing down altogether. The serious thing about that, as we all know, is that the smaller tournaments are the nurseries of boxing and, indeed, the life-line of that sport. We can see the result of this general decline in our boxers today.
Our younger boxers have no opportunity of getting the necessary experience. There is an old rule familiar to all of us who take an interest in the game. It is that there is only one way to train for a fight and only one way to get experience, and that is by fighting. The trouble today is that the younger boxers are not getting the experience because they have not the opportunity. The result is that as we get further up the scale, where the standard is higher, to the larger tournaments, we find that we have to bring in alien or foreign boxers to draw the crowds, and I am afraid that we are getting to the position when we simply shall not have people good enough to meet them.
I give as an example of not increasing the tax on the sport the case of Northern Ireland. There has been no increase in taxation there, with the result that there has been no decrease in the number of tournaments. It is an old rule of taxation that the time to stop taxing is when the tax reaches the stage when the law of diminishing returns begins to operate. The British Boxing Board of Control visited the Financial Secretary last year and we warned him that if this taxation continued it must inevitably almost kill the sport. It will not kill it altogether, but our standard will be so appallingly low that we shall not be able to take part in international contests.
7.30 p.m.
I like Association football, to which the hon. Member for Stoke-on-Trent, South (Mr. Ellis Smith) has referred, but that is flourishing and there is plenty of money in it, whereas there simply is not the money in boxing. If this rate of taxation continues, the standard of boxing in this country will decline to such an extent that we shall have nobody good enough to start competing for international honours. I know that the Chancellor does not want to kill the sport, but if he does he will not have to wait until the right hon. Lady the Member for Warrington (Dr. Summerskill) gets busy, if she has the opportunity. All my right hon. Friend will have to do will be to continue the present level of taxation. Hon. Members on both sides of the Committee will agree that if it continues it will wipe out boxing altogether.

Mr. Arthur Henderson: I want to add my plea to that of my hon. Friend the Member for Stoke-on-Trent, South (Mr. Ellis Smith), not only in relation to football, but to all forms of sport. The action taken by the present Chancellor's predecessor in 1953 has had a most beneficial effect on many cricket organisations, but I should have thought that we have now reached the point where there is such a very thin line between some forms of amateurism and professionalism that our approach to the problem which we are now discussing should be in relation to the fact that a match or game is taking place and we should not be concerned primarily as to whether those who are playing are paid or not.
Let us consider the extraordinary position today at various national centres of sport. At present a Test match is being played between England and Australia at Lords, and I assume that during the four or five days of its duration between 120,000 and 150,000 people will have paid to see it. No Entertainments Duty is imposed upon the proceeds of the match. Today, the annual tennis tournament at Wimbledon has started and, presumably, during its two weeks' duration about 200,000 to 250,000 will pay to see the matches and no Entertainment Tax will be paid on the proceeds. At Twickenham, the national centre of Rugby Union football, 70,000 or 80,000 people may pay to watch an international match and no Entertainments Duty will be paid on the proceeds of that great event.
At Wembley, the national centre of Association Football, possibly 100,000 people will be present at the Amateur Cup Final and no Entertainments Duty will be paid on the proceeds. The following week at the professional Cup Final, about £15,000 Entertainments Duty will have to be paid, yet the financial obligations of the professional clubs engaged in it are far greater than those which have to be borne by the amateur clubs who will have played there the previous week.
Why is there this distinction? Like the Chancellor himself and other hon. Members, I have in my time been a keen amateur football player. We should like to see amateurism prospering and flourishing and as many

amateur clubs as possible operating. But why should there be this difference in treatment between great, spectacular amateur events, such as are taking place at Lords and Wimbledon this week, and the great spectacle of the professional Cup Final at Wembley?
My hon. Friend the Member for Stoke-on-Trent, South has pointed out that many professional clubs are in serious financial difficulties. He has rightly stated that some of these clubs are kept in being only by the generosity of some individuals who are interested in them. I am told that between one-quarter and one-fifth of each gate at a professional football match—and I imagine the same applies to Rugby League matches—goes in Entertainments Duty and almost as much is paid in Entertainments Duty as is received by the clubs.
We know that many professional clubs have started a players' provident fund whereby it is intended that 10 per cent. of the pay received by the individual player is made available to him at the end of his professional life. I believe that that fund which is organised in the Football League is the only provident fund of its kind in the world of sport. This is an obligation which has been cheerfully undertaken by the professional clubs belonging to the Football Association, but the clubs must obviously rely to a great extent upon the receipts from their gates.
Professional Association Football matches, Rugby League matches, ice hockey matches and tennis tournaments are held at Wembley and, under the present arrangements, they are subject to Entertainments Duty, whilst amateur matches played at Wembley bear no tax. Yet Wembley Stadium has played a great part in sport. I understand that in 1948 the Wembley Stadium Co. paid out over £200,000 on the construction of an Olympic Way and on providing some of the finest dressing rooms that have ever been made available for those taking part in the Olympic Games. No assistance was given by the State. It was their contribution to the encouragement of the Olympic Games held in this country in 1948. All those facts converge on to what I asked the Chancellor to consider, a new concept of the treatment of sport in our country.
My hon. Friend the Member for Stoke-on-Trent, South has stressed the value of sport in our national life. I realise that the removal of Entertainments Duty will not treble or increase tenfold the number individuals who will play games and enjoy the resulting physical advantage. May I suggest, however, that there is one important aspect which might be encouraged if the clubs were given this remission of taxation?
I am told that in some countries the sports centres which have been started are infinitely superior to those here. I do not believe it necessarily follows that a remission of Entertainments Duty will mean a lowering of the prices of admission. I heard a broadcast the other day from Nottingham in which it was stated that fine training facilities had been provided by the Notts County Cricket Club as a result of the assistance received following the exclusion of professional cricket from Entertainments Duty.
In these days, when national prestige is playing such a part in world athletics and sport, I should have thought that anything we could do as a Parliament to make it easier for the sports authorities of our country to increase their training facilities and to ease their financial burden, would be a great encouragement to and a great strengthening of our national effort in the world of sport.
I hope, therefore, that the Chancellor will listen carefully to the arguments we are putting forward. They are not made in criticism because, as I said at the beginning of my remarks, I believe that the action of his predecessor has had a beneficial effect upon cricket. So I believe that if the right hon. Gentleman could see his way to sacrificing the £3½ million which he now receives by way of Entertainments Duty from the various sporting activities of the country, it would be an economy which would be well worth while.

Mr. John Dugdale: Like my right hon. and learned Friend the Member for Rowley Regis and Tipton (Mr. A. Henderson), I want to say how pleased I am that the previous Chancellor took the action he did in 1953, which has been a great benefit to large numbers of sports. However, I think that the position taken up then has proved to be an illogical one, and unless this remission is

extended to all games played by human beings—of which I think football to be one, in spite of anything the Government may think to the contrary—sport will not get the encouragement it needs.
The main argument against extending the remission of Entertainments Duty to football is that it is said to be a profit-making and a professional game. What are its profits? Naturally, football organisations do not want to run at a loss. If, however, by profits are meant vast dividends paid out to shareholders, I might point out to the Committee that my own club, which is one of the more successful ones, and might be expected to make some profit, paid a total sum of £24 15s. in dividends. That is not a large and extensive profit going into the pockets of rich shareholders. Not only that, but the directors do not receive any pay. They receive no pay and the shareholders receive £24 15s. in dividends. It cannot, therefore, be said to be a profit-making organisation in the ordinary sense of the word.
7.45 p.m.
That profit was made last year. It will be much more difficult this year because for West Bromwich, as for many other clubs, assessments on their grounds have gone up recently. That is an important point. For example, the assessment of West Bromwich has gone up from £1,400 to £4,000, which is quite a considerable sum and something to which the Chancellor might pay regard when he is considering whether now is a better time than three years ago for making this change.
I have spoken about large clubs, but it is really the small clubs about which we are most concerned. I shall not say a great deal about those because there are others who know more about them and will make their case eloquently. I ask the Chancellor, however, to remember that it is not only the large clubs which are causing us to be so worried about this tax, but the smaller clubs, many of which may go into bankruptcy if the Chancellor retains it.
My right hon. and learned Friend the Member for Rowley Regis and Tipton referred to the position of amateurs. We must face the fact that the difference between a professional and an amateur is not clear. I will give one example from


another sport of which I am very fond, and which I would have great pleasure in watching today if I were not here, and that is lawn tennis. Recently, a man I know wanted to have a tournament in a certain foreign country and to get some good players. He made inquiries and found that there is definitely a rate for the job which has to be paid for players. For instance, in the case of Head he found that the price would be not far short of £1,000 for attending a tournament. The figure was reduced for certain other players and eventually he found players who would take a mere £200 or £300. Yet that is an amateur sport. It does not seem to be right that it should get a protection given to amateur sports whereas football does not get such a protection.
Let us consider the basis on which amateur sport is fixed. I should have thought that one of the criteria was that either everybody was paid or nobody was paid. In amateur sports, just as much as in so-called professional sports, the groundmen are paid, the officials are paid, large numbers of people are paid. The only difference is that some of the players are not paid in the case of amateur sports. What about the position of cricket? Even the previous Chancellor admitted that it was in an entirely different position. He said that:
… cricket occupies a special place among sports, not only as forming part of the English tradition but as a common interest helping to bind together the various countries of the Commonwealth."—[OFFICIAL REPORT, 14th April, 1953; Vol. 514, c. 55.]
That is as it may be. I have no doubt that cricket is a fine sport, but after all football is a world sport played by almost every country, whereas cricket is played by only a small number of countries.
If we were to choose a national sport, judging by the interest shown in it, football undoubtedly interests more people than cricket. I know that there are many people watching the Test Match, but would all those people watch the Test Match if it were played in mid-February weather? Yet many people watch football matches then, and they sit hour after hour watching, in spite of the weather and in spite of the fact that they are not able to sit in sunshine. They sit there because they really enjoy watching the game. I think we should have regard to that fact, and the Chancellor should extend the

beneficence of his predecessor into the realms of professional football.
If, as my hon. Friend the Member for Stoke-on-Trent, South (Mr. Ellis Smith) said, we are to win matches abroad, we must see that our young men can play in those matches and that they can get trained for them. We cannot do so if we are going to tax the sports in which they play. It is becoming increasingly important nowadays for us to win these matches. Just as the export trade is becoming more difficult for us today, so is the winning of matches abroad. We meet competitors from all over the world. The Chancellor is drying up slowly, but not all that slowly either, the reservoir of young men and women upon whom we can draw for these sports. I hope he will think again and appreciate the need to encourage not certain sports but every sport, and, having thought again, will remove the tax.

Mr. C. R. Hobson: I find myself in complete agreement with the speeches by my hon. Friend the Member for Stoke-on-Trent, South (Mr. Ellis Smith), my right hon. and learned Friend the Member for Rowley Regis and Tipton (Mr. A. Henderson) and my right hon. Friend the Member for West Bromwich (Mr. Dugdale).
I want to draw the attention of the Chancellor to a statement made on 20th May, 1953, by the present Minister of Pensions and National Insurance, who was then Financial Secretary to the Treasury:
My right hon. Friend has made it clear from the action which he is taking in the proposals in this Bill that he keeps the position of this and other sports under review, and I can say on his behalf that he will carefully watch the position of the football clubs, and perhaps in particular the smaller or third division clubs to which particular reference has been made."—[OFFICIAL REPORT, 20th May, 1953; Vol. 515, c. 2128.]
While that was not a promise, it was an appreciation of the fact that in the event of there being a reasonable surplus the taxation of sport would be reviewed.
It is common practice, when the Finance Bill is passing through Committee, for the Chancellor to have a few million pounds up his sleeve to enable him to make certain concessions. He has so far been rather miserly. The only concession has been one to overseas companies in respect of taxation.
I appeal to the Chancellor to consider in particular the smaller soccer clubs in the Third Division and the Rugby League clubs. Rugby League is played chiefly in the North of England. There are 30 professional and 305 amateur clubs. The amateur clubs get very small gates; the people who play the game do so because they enjoy it and attendances are of secondary consideration. These small amateur Rugby League clubs have to pay Entertainments Duty, which, in itself, is a serious anomaly which ought to be looked at.
To turn to the so-called "big fish", the 30 professional clubs, they belong chiefly to small towns such as Batley, Bramley, Castleford, Oldham, Rochdale, Keighley, Workington, Wakefield and Dewsbury. It may be said that Leeds and Bradford, which have Rugby League Clubs, are large cities. That is true, but they have also First Division and Second Division soccer clubs. I am concerned chiefly about the position of Rugby League clubs. I fail to see why Rugby Union, merely because it is classed as an amateur sport, should be completely relieved of Entertainments Duty, and why the same consideration should not be given to Rugby League.
The receipts from an international Rugby Union match at Twickenham are greater than Keighley's total receipts for one year, yet the Keighley club has to pay tax. It is absolutely unfair. I should like to know why the Chancellor puts Rugby League football in this special category. The position is even worse because of the peculiar rules and regulations about professionals and amateurs. Rugby League clubs using Rugby Union grounds cannot avoid paying tax, which seems to be entirely wrong.
Since 1930, the Treasury has taken £23,000 from the Keighley club, and during the same period the club has lost £5,800. This seems to be a most unfair situation. The deficiency is met as was stated by my hon. Friend the Member for Stoke-on-Trent, South; public-spirited people meet it out of their own pockets.
Rugby League clubs are in a very serious financial position. They are unable to provide the necessary equipment. They attempt to balance their books by private subscription or by

running whist drives, raffles and pools, and they will now have competition from the Chancellor's Premium Bonds. The Chancellor must get down to the facts about Rugby League football. The attendances are not large enough to make it pay, and I submit that the clubs are entitled to special consideration.
After all, cricket has been relieved of Entertainments Duty. Take the Yorkshire County Cricket Club, which is a very good one, and I am not sure that it will finish below Lancashire. It is certainly a profitable undertaking. Last year it had an income of £59,175; indeed, it had an income of £27,709 before a ball was bowled, which is a very satisfactory state of affairs.
The Chancellor found sufficient good reasons for relieving cricket clubs of Entertainments Duty. I suggest that precisely the same reasons apply to Rugby League football. During the debate on the exemption of cricket, reference was made to the fact that the British people have a special affection for cricket. So they have for Rugby League football, particularly in the North of England. With regard to the argument about Commonwealth ties, I would point out that Rugby League matches are played between Australia and New Zealand.
I believe that the Chancellor is in a position to make concessions this year, and he should choose the sports in which concessions can be made. The position of Third Division soccer clubs is also precarious. The clubs are likely to go out of existence if nothing is done, as is the case with Rugby League clubs. I do not think that anyone would complain if a concession were made, because it would not cost much. I appeal to the Chancellor to give serious consideration to the position of Rugby League clubs on the basis of the statement made in 1953.

8.0 p.m.

Mr. Ian Mikardo: In this general debate, which is covering the proposals made in a number of new Clauses, I should like to refer, in particular, to the point made in the last new Clause, in page 3736 of the Notice Paper in the names of myself and my hon. Friend the Member for Barrow-in-Furness (Mr. Monslow). This is much more limited in its scope than that put forward by my hon. Friend the Member for Stoke-on-Trent, South (Mr. Ellis Smith), because it does not seek


total exemption from Entertainments Duty, or even an overall reduction of rates of duty. It seeks only to reduce the total amount payable in duty in respect of fixtures at which the receipts are less than £2,000 in any one case.
I need scarcely point out that this new Clause is not put forward in competition with that moved by my hon. Friend the Member for Stoke-on-Trent, South, or with other new Clauses which are to be moved by others of my hon. Friends. It is, so to speak, a last line of defence. I share the view already expressed by my hon. Friends that there is now no basis for the somewhat artificial discrimination, which was made by the right hon. Member for Saffron Walden (Mr. R. A. Butler), when he was Chancellor of the Exchequer, between amateur and professional sports. I share the view that the time has now come to relieve all sports, other than those which exist almost solely for the purpose of gambling, from duty.
It is only against the possibility that the Chancellor of the Exchequer might harden his heart against that appeal and be unwilling to forgo all the revenue which he gets in Entertainments Duty from sport at present, that my hon. Friend and I have put down the new Clause. If the Chancellor is seeking, as we hope, to make some concession in this respect in this Budget, it enables him to make a concession where it will do most good at the least cost to the Revenue.
It may be asked why the new Clause singles out three particular sports, namely, Association football, Rugby League football, and boxing. The answer is that in considering this matter, as I did a couple of years ago when I moved a rather similar new Clause, I put myself in the position—or tried to do so—of the Chancellor when he is considering his Budget. Successive Chancellors of the Exchequer have told us, no doubt with absolute truth, that, in the germinating period before the Budget is produced, whatever else they are short of they are never short of advice.
Doubtless they get many suggestions and doubtless one of the topics about which suggestions are made is the Entertainments Duty as applied to sport. I can well imagine the sort of conference which takes place among the right hon. Gentleman's officials at the Treasury when they are preparing little minutes for

him as a basis of his consideration of what he should do in the Budget. I can well imagine these gentlemen being much more skilled in finance than in sport and knowing much more about taxation than about sport.
I can well imagine one of them saying, "My dear chap, I read in the paper the other day that there were 100,000 people at one match and the receipts were £55,000. Obviously, this is a hugely profitable business and, therefore, we ought to soak them good and proper." I can well imagine another one of the right hon. Gentleman's advisers saying, "I keep on reading fabulous stories about a certain fabulous boxing promoter who seems to have a very high standard of living. It is clear that there is plenty of money in the boxing game and no case for relieving the sport in which this gentleman is interested of any of the burdens which it carries at present."
These three sports—and this is why my hon. Friend and I have singled them out—are common in one important characteristic. They are all sports in which there is a certain number of clubs, companies or promoters—a small number—who do very well and make plenty of money and get along very well without extraneous assistance and in respect of whom one might reasonably make a case for their being able to bear all the burdens which they are called upon to bear at the present time, while, at the same time, in the same sport, there is a majority of promoters, companies or clubs which one could well describe as the poor relations of the sport and which are finding it difficult to make ends meet.
It is in respect of those sports, more than of any other, that it might be said that there is some case, if one is not to exempt the sport altogether, for seeking to find some mechanism which discriminates against the wealthy operator, the highly profitable operator in the sport and in favour of those who are finding it difficult to make ends meet. There is here no new principle and nothing which should shock the right hon. Gentleman, or the other gentlemen of the Treasury, because what is here being proposed is something which is roughly the equivalent of the initial allowances which the right hon. Gentleman gives to other Income Tax payers.
The right hon. Gentleman says of other Income Tax payers that he will start to levy not at nought, but at something above nought, although it is not very large. What my hon. Friend and I are proposing in respect of Entertainments Duty is that the levy should not start from nought so far as the takings of the club are concerned, but that there should be an initial allowance—a not very large initial allowance—which goes free of burden.
I appreciate that there is one procedural difficulty about the new Clause. It is that the man who pays the tax is the spectator and it might well be said that if there is to be any relief of tax, that relief of tax must go to the spectator and not to the organisation providing the entertainment, whereas the proposed new Clause gives relief to the club, or promoter and not the spectator.
The right hon. Gentleman might well argue that it would be difficult to administer the arrangement proposed in the new Clause, because once a club has been relieved of its £100 it could not seek out all its patrons who had subscribed the money and give them back 2d., 3d. or 4d. apiece. The fact of the matter, if we are facing the realities of the economics of running a sport in this country at the present time, is that the relations among the spectator, club and Chancellor have subtly, but markedly, changed over the last few years.
It is no longer true, in practice, that the club is an organisation which gathers tax from the spectators to pass it on to the Chancellor. The situation now is that the spectator is not conscious of what part of his admission fee is tax and what is not. He pays it as an admission fee and would be happy to see the club retain the whole of it, as in the case of cricket, Rugby Union football and other amateur sports which did not reduce their prices when the right hon. Member for Saffron Walden relieved them of tax. The spectator is quite happy that the club should retain the whole of his admission fee and, therefore, to the extent that the club does not retain the whole, it is the club itself which is paying the tax.
Therefore, there is nothing at all wrong with an arrangement which seeks to relieve the club of some part of the tax for its own retention. Measured against that

criterion, one advantage of this proposed arrangement is that it is the easiest thing the right hon. Gentleman will have to administer. We know that, quite pardonably, Chancellors of the Exchequer do take into account, in considering any proposal which comes before them, whether it is administratively practicable, administratively difficult, or administratively easy.
Nothing would be easier than to operate this initial allowance upon the basis which is proposed. The right hon. Gentleman will doubtless be familiar with the methods by which football clubs, boxing promoters and the like return their figures for the purposes of paying Entertainments Duty. He will know that they use Customs and Excise Form E.D.31 or. with the permission of the authorities, a large duplicate book which is no more than an enlarged copy of Form E.D.31 upon which are returned particulars concerning the number of tickets and places sold, the rates of duty, and so on.
Column H shows the actual cash takings for admission at each price, and the total of that column therefore shows the total cash takings. The next column shows the total duty at each admission price, and that is totalled at the bottom to show the total duty payable for the fixture. To operate the Clause it would merely be necessary to add one figure to Form E.D. 31, namely, a deduction from column I in every case in which the total of column H did not exceed £2,000.
My right hon. Friend the Member for West Bromwich (Mr. Dugdale) referred to what he called the big chaps and the small chaps in football. He quoted the club in his own constituency—West Bromwich—as one of the big chaps, and there are many he could have quoted as representative of the small chaps. I wonder whether the Chancellor realises how much the running of Association football and Rugby League football—about which my hon. Friend the Member for Barrow-in-Furness knows much more than I—depends financially upon the density of population and, conversely, the distances which people have to travel to go to these places of entertainment on Saturday afternoons.
The Arsenal, for instance, is in the middle of a densely populated area of North London. Although some people travel a long way to see the Arsenal—


I can never understand why—the over-whelming majority come from places which are so near that they have to pay only a few coppers in fares. The same remark applies in the case of West Bromwich, which includes among its adjacent areas Birmingham, Wednesbury and Smethwick, upon which it can draw. There again, a man may well pay 3s. to get into the ground at West Bromwich or Highbury, because his total expenditure is only 4s.—3s. entrance fee and 6d. each way for fares.
But many small Rugby League clubs and Association football clubs in the two Third Divisions draw their support not only from their own small areas, but from a considerable area all round them. The football club in my constituency has no professional club nearer than Aldershot to the south, Swindon to the west, London to the east and Birmingham to the north. People come a very long way to see it, although it is only a humble club. Many spectators pay 2s., 3s. or even 4s. in fares before they pay the entrance fee.
It is apparent that these supporters are much less likely than the supporters of the Arsenal or West Bromwich to pay a 3s. entrance fee. The smaller football clubs have been very hard hit because fares have risen. It was noticeable that the attendances of these small clubs dropped fastest not when the prices of admission were increased, but when the local fares were increased. That is the principal reason why clubs in the smaller towns who draw their clientele from a fairly wide area are so much more vulnerable from the larger clubs in the more densely populated areas. Many of the smaller clubs are living from hand to mouth and facing near-bankruptcy.
I end by expressing the hope the Chancellor will accept the Clause moved by my hon. Friend the Member for Stoke-on-Trent, South, which is based upon an absolutely unanswerable case. If he should find that he does not want to remit the whole of Entertainments Duty on these sports at one go, in one year—perhaps he wants to agree to my hon. Friend's proposal next year—and is seeking to find a way of doing some good on the cheap, where that good will do most good, I commend to him the proposal contained in the Clause in my name.

8.15 p.m.

Mr. David J. Pryde: I accepted the responsibility of putting down the proposed new Clause standing in my name and in the name of my hon. Friend the Member for Lanarkshire, North (Miss Herbison) with a considerable amount of diffidence. I pointed out the difficulties which we had encountered in previous years, but Mr. T. C. Young, the Secretary of the Scottish Games Association, said, "That is all right David; we now have a new Chancellor. He has a clansman's name and may be more susceptible to an understanding of the Scottish position than the other man." I said, "Perhaps he is a cricketer." Tom replied "No; they do not play cricket in Westminster, David." I had to consent.
Such a small sum is involved here that I am sure the Chancellor will consider the question again. I am told that only £80,000 is involved. The Chancellor will not get £80,000 this year because this iniquitous tax is driving the Highland games out of existence altogether.
The Clause contains a double-barrelled phrase. The second part clearly shows what we are aiming at. We ask the Commissioners of Customs and Excise to consult the Secretary of State for Scotland upon the definition of "amatuerism" and "professionalism", because previous debates have shown that there is a certain misconception and misunderstanding about the running of the Highland Games.
The Highland games have never been visualised as a commercial proposition. They are always promoted by the voluntary efforts of the people, and many of them go back for hundreds and hundreds of years. There was Ceres, which dated from 1314, and which came into being because of a wave of patriotism arising from the fact that the Scots had won their freedom at Bannockburn—although they lost it at Westminster later. The Highland games in the wild Highlands take place on one day in the year, when the clansmen gather together to test their skill, fleetness and stamina in various ways. They are not professionals at all, because the prizes for which they competed were indeed small and meagre.
For instance, we are told that the amateur is one who does not run for


money. But up in the Highlands it would be impossible to carry the pieces of furniture, such as chairs, clocks, etc., to give as prizes to all the various Highland games winners. I know an amateur who played bowls and who furnished his house from prizes won on the bowling green. John MacIntosh of Newton Grange must have won sufficient furniture to furnish a row of miners houses, because John is a prince of champions and the name of MacIntosh is well respected in bowling circles.
Mr. Black, a paper maker of Polton, won some of the most valuable prizes imaginable, when we compare them with the prizes won by. Alexander Anthony Cameron of Spean Bridge who was a policeman. Unfortunately he has gone, but his caber remains to this day to allow the pygmies of today to see what a giant was like. Cameron could place his huge caber on two fingertips and step forward and toss it. There are no people today in line to follow on that tradition because this iniquitous tax is taxing the games out of existence and our people do not get any practice. There are no more George Clarks, Nicholsons, Kirkwoods and Camerons. They have disappeared.
I am not making a case for Highland games against other amateur promotions. In my constituency I have two Olympic hopes, Dr. Euan Douglas of Penicuik, who will, I am sure, bring home a gold medal, and there is another near my home at Eskbank, West Calder, the town we discussed in connection with oil shale, where we have an amateur promotion which has to depend on voluntary effort and where the prizes are more valuable than the prizes given at Highland gatherings. Year after year we get reports of yet another Highland gathering going out of existence. This year, from the Secretary of the Scottish Games Association, I have evidence here from the North of England where in Northumberland and Durham also the games are going. This year I took the trouble to arm myself with concrete evidence, because on the last occasion on which I took the opportunity to raise the position of Highland games I instanced the great men of athletics in the field. At all Highland gatherings foot racing is one of the basic items on the card. While in England we had the doggerel

When there was heard the sound of a coming foe,
There was sent round England a bended bow.
In Scotland it was the "fiery cross", and here in the volume which I hold in my hand I have photographs of the resuscitation of the marathon in Scotland. To paraphrase what Byron said:
The mountains look on Marathon
And Marathon looks on the sea,
And musing there an hour alone,
I dreamed our land might yet be free.
The Chancellor could do something at least to ameliorate the sufferings of our people who are being prohibited from enjoying the one day in the year when they look forward to the opportunity of celebrating. If it is a wet day, the sports are spoilt.
In the early 'seventies, the Scots resuscitated the greatest centre of foot racing in Scotland and possibly in the world. I have here a photograph of the three men who did so much to contribute towards the resuscitation of this particular form of sport in Scotland, Fred Lumley, W. M. Lapsley, and A. R. Wood. Here is a photograph of one of the founders of Powderhall. There were four brothers who founded Powderhall, the Bauchope brothers. One of the brothers proved successfully that foot racing was not peculiar to the athlete in Scotland. He won championships for putting the cannon ball and pole vaulting. Many of our athletes were runners and many runners were athletes. Here I have photographs of some of the men who ultimately made records in Scotland as foot racers. Here is a photograph of Tim Banner, who was an "Aussie", certainly, who came to Scotland to show his paces, which I think is a great credit to the sportsmanship of the Scots. I have also a picture of Hunter of Shettleston, the third of three brothers who ultimately finished in my home town. One was John Hay of Edinburgh, a Bailie of Edinburgh, and B. R. Day of Dublin, a great Irishman.
We have also the start of the attempt to prostitute the sport in Scotland and how the promoter of Powderhall so aptly dealt with that particular incident. It concerned an entrant called Craig of Inverness. Mr. Lapsley the owner of Powderhall said to a lad who was rather young looking, "You are Craig of Inverness?" The lad replied, "Yes, Sir." Mr. Lapsley asked, "How old are you?" He


replied, "Twenty". Then the lad said, "Will it be all right?" And Mr. Lapsley replied, "No, it will not. You are not Craig of Inverness at all, my lad. I could institute police proceedings against you, but I am not going to do that. You are G. B. Tinkler of Dublin", who was the son of a Dublin solicitor. Tinkler held his head in shame, because he knew that he had been found out. Lapsley treated him as one sportsman to another, and said, "You will run one lap here, and then drop out." Tinkler did so and went on to a great career in foot racing. In the summer time these men made the Scottish Highland games. They are the men whose photographs I have and they include Bill Struth, the man who ultimately organised the Rangers; Tom Brandon of Edinburgh, and Jimmy Duckworth who trained the Hearts and many Edinburgh runners who made history.
The prizes they won were only half crowns and five shilling pieces but the men who won the Powderhall sprint might benefit to the extent of £75 or £100. The point is that these men did not live by professional foot-racing.
8.30 p.m.
The question of amateurism or professionalism should be decided as it is decided in cricket, according to whether the particular runner or athlete lives wholly or mainly by his sport. If he does not live wholly or mainly by it, he ought not be to deemed a professional and the Government have no right to tax people for going to see the sport. So I would ask the Treasury to look at this matter again. We believe that Scotland has not had justice and that there is a danger that the Highland Games will disappear altogether.

Miss Elaine Burton: I would like to address my remarks to the Clause which has been moved by my hon. Friend the Member for Stoke-on-Trent, South (Mr. Ellis Smith), but first of all I would say a word about Association football. I do not know whether the Financial Secretary will reply, but he probably knows the background of what I am going to say. Just on the off-chance that he does not, I will mention it.
There are 31,000 clubs affiliated to the Football Association. Of that very large number, 213 are full members and 134

are associates. These 347 clubs are of higher status than all the others which make up the 31,000 and are in direct membership, taking part in senior competitions. These 347 are divided into two categories. The first category of club has no player employed as a profesisonal. The second category has and employs them under contract. The first category numbers 130 clubs. Every club in the second category obviously contains 217 clubs and each club has amateurs as well as professionals in it.
We have heard no mention tonight of the fact that when the question of Entertainments Duty was first mooted to the Football Association as long ago as 1916 the assurance was given that the tax was not to continue in perpetuity. I also agree with my hon. Friend in finding considerable difficulty in understanding how the Government decided that football was not played by living people. That is quite incredible, and I hope that that matter will be cleared up at once.
That brings me to the question of amateurs. I am very glad, and I sure that my hon. Friends are also glad, that amateur sports were exempted from Entertainments Duty, but the time has come to extend the exemption to all. I would very much like to go into the question of amateurism and professionalism, but that would take a long time and I do not intend to do it tonight. The Government should consider, though, that Association football is played out of doors in all weathers and that a great many of the professional clubs have not sufficient covered accommodation for spectators, especially in the cheaper parts of the grounds. They have not got it, because they have not enough money left to provide it.
Will the Financial Secretary explain to us—or admit that the situation is quite ridiculous—how it is that when our best professional teams play footfall in Northern Ireland no Entertainments Duty is levied, or on any other outdoor games there? A first-class team pays Entertainments Duty in this country, while exactly the same team goes to Northern Ireland and plays an outdoor game, and no duty is levied.
Every Saturday afternoon in this country hundreds of thousands of people watch professional and amateur sport. I firmly believe that if the Chancellor


does not make some concession on Entertainments Duty we shall find that some of those spectator sports will become almost non-existent. Obviously I am not talking about world championship boxing, the Football Cup Final at Wembley, the Rugby League Final or World Speedway Championships. Those will still draw hundreds of thousands of people, and I am glad that they will. I mean something which is even more important—which we who care about sport and athletics agree is more important.
I believe that this Entertainments Duty is preventing the opening of all those avenues—the tracks, the fields or the nurseries—which lead to the first-class teams, and I think they are more important than the first-class teams themselves. They mean a great deal in the social life of our country. I would make the sweeping general statement that I think every country except our own recognises that fact—every single one.
In common with many hon. Members, and in particular with those on this side of the Committee tonight, I was brought up in a world of sport. I know full well the difficulties that some of the minor clubs have in paying their way. Small professional boxing tournaments held in local public baths in the winter have to make a real effort to make their way. Speedway teams are struggling to get on, and so are Rugby League clubs. Many of those nurseries give youngsters their chance, and I believe that that chance is being killed today by the imposition of the Entertainments Duty. Two years ago I was told that the Rugby League had 22 clubs which wanted to improve their facilities for spectators and players but 18 of them had to say that that was financially impossible. Clubs in those difficulties need help, not a tax which will put them out of business.
If my figures are correct, in the financial year ended April, 1955, the Chancellor took something like £32,720,000 out of sport. He took £21,500,000 out of football pools and £7,450,000 from tote betting tax and bookmakers' licences at greyhound tracks. What we are more immediately concerned about is that he took £3,730,000 in Entertainments Duty from football matches, horse and dog racing, speedway, boxing and other

events. I wonder whether the Government Front Bench ever realise that if there were no professional football in this country, the Chancellor would not only lose its contribution towards Entertainments Duty but £21½ million from the pools as well. I believe that a perfectly fair point to make.
My complaint against the Chancellor is not only that he took £32,720,000 out of sport last year, but that he put nothing at all back into sport. That is my real complaint against him tonight. On every Saturday afternoon for every person taking an active part in some sport between 26,000 and 30,000 watch sport. That is a mighty big proportion—30,000 to 1. If the Financial Secretary is to reply, I wonder if he will tell us that he is aware of the figures which I am about to give. They are rather alarming. In the last survey made in this country concerning recreational facilities, it was found that we have one rugger pitch for every 75,000 of the population. There is one soccer pitch per 6,350 of the population, one cricket field per 12,000 of the population, one grass tennis court per 9,300 and one running track per 410,000 of the population.
I am quite sure that the latter figure must make the Parliamentary Private Secretary to the Chancellor shudder, and I hope he will pass it on to the Chancellor when he sees him afterwards. What I think is worse is the fact that Sweden, with a population of 7 million, has 800 running tracks, while here we have 136, and many of these are private. I will admit that a large number of the running tracks in Sweden were made possible largely by the contributions of the football pools.
I should now like to make this general point. Last month, when the English soccer team went to Western Germany, they had an opportunity of training in something which we have never seen in this country yet. It is still a dream to us. The members of that team trained in a sports centre deserving of the name. At the moment, we are scratching around seeing if we can find the money for the L.C.C. training centre which they want to sponsor, and we have not got anywhere near it yet. This sports centre in Germany cost £500,000. It combines outdoor soccer pitches, an indoor pitch, an outdoor swimming pool, an indoor bowls


ink, lawn tennis and table tennis facilities. I think that what is so alarming when we think of this country is that that sports centre is one of eight in Western Germany alone.

Mr. Ede: Far better to lose a war than to win it.

Miss Burton: I think we could even win a war, with all due deference to my right hon. Friend the Member for South Shields (Mr. Ede), and not apply Entertainments Duty to sport. I think we could have both.

Mr. Ede: What I said was that it was always far better to lose a war than to win it.

Miss Burton: I know, but I was not letting my right hon. Friend get away with that, because I do not want the Government Front Bench to shelter behind it. I still think that we could have both today.
Our own football team which went to Germany said it was a perfect joy to do their training in such a centre, and to people like ourselves it is just a nostalgic dream. What would it mean to our youngsters if they had the opportunity of training in places like that? How many of our spectators on Saturday afternoons, quite honestly, would prefer to do something if they had ever had the chance as youngsters of being trained for it? But it is the Chancellor who prevents this coming about. This centre in Western Germany and the other seven similar centres were provided by money out of the pools.
Do not the Government think the time has come to put something back into sport? I know I would not be in order tonight in suggesting that the Chancellor should take some of the money from the pools and put it into sport, and so I just mention it and leave it at that. The amount raised by Entertainments Duty is more than £3 million, and if the Chancellor were to put £1 million back into sport, he would give the youngsters of this country an opportunity which is not only their right but equally an opportunity to have that which is available to them in other countries. I have great pleasure in supporting the new Clause moved by my hon. Friend, and I hope that this time the Government will give way.

8.45 p.m.

Mr. Reader Harris: I hope that the slender attendance on these benches will not be taken as indicating any lack of interest on this side of the Committee.

Mr. Arthur Lewis: Is the hon. Gentleman not aware that the attendance is now 700 per cent. more than it has been all evening, because only one back bencher has been present throughout the whole debate, though we welcome his presence?

Mr. Harris: I hope that the Chancellor of the Exchequer will take this matter very seriously, and do something, even if it is not possible this year, within the next 12 months.
I think that football is very hard done by and that it suffers from a number of inequalities. We live in an age when inequality is disapproved of, in every quarter, in whatever context it may be found; and football is subject to many inequalities. I have to be careful to keep within the rules of order, but I spent the early part of the day watching the Canada Cup matches at Wentworth. I cannot give the latest scores from the course, but I can give some of the comments off the course by some of the local residents, such as postmen, who want to know why professional golfers can play for money on Sundays whereas professional footballers cannot.
Another question we might ask—and here I come back to the inequalities—is why cricket does not have to pay tax whereas football does? These inequalities seem to me to be unjustified at a time when sport is more important that it has ever been in the history of the world. I support the comments made by the hon. Lady the Member for Coventry, South (Miss Burton). I believe that within the next two or three years the Government must pay a great deal more attention to promoting professional sport. Before long we may be back where we were a thousand years ago, when disputes were settled by a tournament or contest. What a good thing it would be if we could settle some of our international disputes by means of football matches. [An HON. MEMBER: "We should have no Empire."] That may be a pious hope, but it is better to toss a football about than to toss an atom bomb about.
The hon. Lady made a plea for sports centres and she suggested that as a first step towards them we should remove the tax from sport. Obviously, that is something which must be done. How much longer is sport to be subjected to this invidious system, which also applies to the theatre, although we are not allowed to discuss the theatre on this Finance Bill? Taxation is imposed not on the profits but on the price of the seats, whether profits are made or not.
I hope that the Chancellor will find it in his heart to look at this principle during the next 12 months. We have discussed this matter for several years, but we have to go on talking about it until, one day, a Government takes action upon it. The principle of taxing an organisation before any profits are made and irrespective of whether profits are made—to put a tax on every seat which is sold, which is done in the theatre and which has killed the theatre—makes life extremely difficult for football clubs.
I feel that we do not pay nearly enough attention to international sport, which is of great importance these days. The prestige of countries rises or falls according to whether their athletes make a good showing at the Olympic Games or other contests. Why should we not put up a good show?
The reason we do not do so at the moment is that we make life as difficult as possible for our athletes instead of as easy as possible. I do not think that we are asking for very much tonight. There are many other things for which we could ask for sport; we could ask for many millions of pounds to be spent on new stadia, and one day we may get round to it.
I support the plea that as a first step we should remove this tax, which at the moment is imposed irrespective of whether the organisation concerned makes a profit at the end of the year.

Mr. Tom Brown: Mark Twain wrote in his book,
Brevity is the soul of wit".
I cannot be witty, but I intend to be brief. The hon. Member for Heston and Isle-worth (Mr. R. Harris) referred to inequalities. That is the first time while I have been a Member of the House that I have heard hon. Members opposite talk

about equality. Now we hear about inequality in sport.
If we were to pay tributes, those tributes ought to be profuse to the sporting element of this country for what they have accomplished despite the lack of facilities provided for them. No nation does less for its sporting element than does this country. I am a very modest chap, although I say it myself, and sometimes I am compelled to hang my head in shame when I think of what is done for sport on the Continent in comparison with what we do in Britain. It is about time that we stopped this crazy idea of supporting sport in such a niggardly and parsimonious way.
I want to reinforce the plea that has been made on behalf of the Rugby League football clubs. I live in the very heart of this sport. It is a miner's sport I am a soccer fan, but I live in the midst of the Rugby League football clubs. Wigan, Warrington, Widnes, Leigh, St. Helens and Swinton are all noted clubs in the Rugby League, and they play every Saturday afternoon. Whether there is frost, snow, rain or sunshine, the men congregate together to watch their favourite sport.
Yorkshire has been mentioned by my hon. Friend the Member for Keighley (Mr. Hobson), and I should like to mention Lancashire. In Yorkshire and Lancashire there are 30 Rugby League football clubs, 22 of which have large bank overdrafts. Every club in that league has a large scheme afoot to improve the facilities for the team and for the spectators, but not one of those clubs is able to carry out its scheme. The financial position of the clubs is such that they cannot do so. At the moment, the amount of money being spent on these schemes totals £12,500. If that amount is divided by 30 it results in a very small sum per club. It is estimated that, to provide reasonable facilities, it would be necessary to spend £135,385. Yet the Chancellor insists on retaining this tax upon sport.
Here we have a sporting element doing all they can to provide relaxation and sport on Saturday afternoons, and yet the Treasury prevents them from doing the work that they want to do. I can scarcely bring my mind to think that the Treasury approaches this question from an equitable point of view. It is easy


to sit in Downing Street and impose taxes on people, but it is a vastly different thing to go about the country and discover the effect of those taxes upon the people.
I therefore reinforce the plea put forward by hon. Members of this side of the Committee that the Chancellor should consider it this year. He is in a much better position to do it now than he will be in 1957, because if he starts to do something in 1957 we shall have 1958 and probably 1959 here before we see the results. It should be remembered that a promise was made in 1953. The then Financial Secretary, on 20th May, gave an undertaking that the Chancellor, during the course of the next 12 months, would keep his eye upon the sports side and try, if possible, to reduce Entertainments Duty in 1954. Now we are in 1956, and nothing has been done.

Mr. H. Brooke: The Chancellor did something in 1954.

Mr. Brown: What he did was infinitesimal and the effect has been very small.
It is all very well for right hon. and hon. Gentlemen on the Government side, whenever they have an opportunity, to pour forth profound exhortations to the industrial workers: "Increase your productivity. If we are to solve our economic problems, there must be increased production. Stave off any demand for an increase in wages." Increases in wages will follow increased production, so they say, yet, at the same time, the people who appeal to the workers to increase their production prevent the workers from enjoying their afternoon's sport. To me, it is sheer idiocy for hon. and right hon. Gentlemen to put forward these arguments and, at the same time, oppose the plea that we are putting forward on behalf of our sporting element.
As I have said before, we ought to be extremely proud of the sporting element of this country and our job—and I hope that we will face up to it this year—is to help those who are now helping themselves, amidst extreme difficulties, to intensify and extend sport. I want to put four points to the Financial Secretary. First, will he afford a parallel with cricket to the Rugby and Association football clubs? Secondly, will he examine the anomalies in sport relating to the Entertainments Duty created by the 1953

Finance Act, when this matter was discussed? Thirdly, will he examine the effect of the increased rates of Entertainments Duty on the attendances, receipts and net income of football clubs? Fourthly, will he consider the current precarious financial position of many Association and Rugby League football clubs? If he or the officials at the Treasury will consider these problems, if they are fair, and if they desire to wipe out the inequalities which have been mentioned from the Government benches, then I am sure that as a result of their training and outlook they will advise the Chancellor to abolish once and for all the Entertainments Duty, which is anti-social and anti-sportsmanlike. If they do that they will be doing a good job on behalf of the sporting element of the nation which is entitled to some consideration from the Government, for what they do in the realm of sport.

Mr. Walter Monslow: I should like to return to the new Clause in my name and that of my hon. Friend the Member for Reading (Mr. Mikardo). While I entirely support the new Clause moved by the hon. Member for Stoke-on-Trent (Mr. Ellis Smith), and while I recognise that the Clause to which I speak is discriminatory in character, we feel that if the Chancellor is not disposed to grant a total exemption in respect of Entertainments Duty he may be able at least to agree that there is need for some sympathetic consideration to be given to what may be described as a graduated tax.
I want to say something about this, because of the parlous plight of the Rugby League and some football clubs. I think it should be said to the Chancellor tonight that there is profound disappointment throughout the whole range of entertainment that there has been no relief of tax in this Budget at all. It might at least have been anticipated from the 1955 April Budget, which was described by hon. and right hon. Gentlemen opposite as a sunshine Budget, that we would have been fortunate enough to have had some reduction in Entertainments Duty in the present Budget. I am not unmindful of the fact that the Budget of October, 1955, turned out to be what one might describe as a moonshine Budget. If nothing is done by way of


easement of taxation this Budget may well be described as the most dismal Budget of the last decade.
9.0 p.m.
I want to set out a few figures in connection with the new Clause to which I referred. My hon. Friend the Member for Reading set out its objects. He adduced them in a way which ought to commend them for dispassionate examination by the Chancellor who, I hope, will give serious consideration to them. My hon. Friend the Member for Coventry, South (Miss Burton) indicated the volume of money which was taken from the entertainment world. I should like to cite a figure which portrays quite clearly the precarious plight of the Rugby League and the Third Division Association football clubs.
Thirteen clubs, over a period when they suffered a total loss of £40,730, had paid no less a sum than £102,830 in Entertainments Duty. That I regard as a very serious anomaly. The suggestion embodied in my new Clause is that we should have a graduated tax, the first £500 of any single gate to be free of tax, the second £500 to be taxed at 4s. in the £, and the remaining gate money to be taxed at 5s. in the £. If such a method could be devised to yield the same total in Entertainments Duty as is paid at present, the net effect would be to ease the burden on the smaller clubs. My colleague and I are not pleading tonight for the wealthy clubs.
It should he remembered that a number of Rugby clubs and some of the poorer Soccer clubs have suffered an average yearly loss of £5,000, and it is rather surprising that the anomaly has been continued by which those clubs have to pay in duty approximately £8,000 a year. The matter should be given serious consideration with a view to some adjustment being made by the Treasury. I know that on every Committee stage of a Finance Bill the Chancellor disburses certain moneys. So far, he has done nothing at all in respect of the home situation but has simply given relief in respect of the overseas position. I appeal to him. If he has any money at all to disburse I ask him to give consideration to the parlous plight of the Rugby League, the poorer soccer clubs and boxing.
Something ought to be done, and done urgently. Some of these clubs will no doubt go out of existence if no change is made. About 1 million people attend football matches every Saturday in the season. What a treat it is to go to a football match. It gives us some stimulus, a fillip, especially when we have to suffer as we are suffering today as a result of the policy of the Government. It strengthens our morale to get away on a Saturday afternoon from the dismal atmosphere and the activities of the present Government.
I ask the Chancellor to help to strengthen our morale by accepting our proposals. If he does not do it now I am confident that a number of our clubs will go out of existence and that, as a result, he will not get the desired production which the nation requires.

Mr. H. Brooke: It may be for the convenience of the Committee if I intervene at this point if only because we are discussing seven new Clauses and some rather wild estimates have been made of the cost of one or other of them and various points have been raised with which I should like to attempt to deal.
We started off with a mystery. The hon. Member for Stoke-on-Trent, South (Mr. Ellis Smith), in his very pleasant speech, alleged that I or one of my predecessors had laid down that Association football was not played by human beings. Shortly before this Budget, I had the pleasure of receiving, on behalf of the Chancellor, an all-sports deputation on the very subject we are debating tonight. If any Treasury Minister had at any time made such an astonishing statement it strikes me as likely that some member of the deputation might have taxed me with it at that moment.
I can guarantee to the hon. Member and the Committee that I made no such extravagant statement in the course of receiving the deputation. Indeed, there were persons concerned with boxing who would have dealt with me faithfully as regards their sport if I had thrown about such an allegation. I can only suggest that somebody in the course of discovering that this particular rate of Entertainments Duty does not apply to the living theatre had drawn the false deduction that those who take part in sport are not alive.

Mr. Ellis Smith: I quoted from a memorandum which had been prepared by the Football Association on Entertainments Duty on Association football and this was an extract from a Treasury statement that had been made. It is true that it was made prior to the present Chancellor and the present Financial Secretary coming into office.

Mr. Brooke: I can take no responsibility for what may have been said when hon. and right hon. Gentlemen opposite were in control of the country's affairs. All I can say with certainty is that none of the present denizens of the Treasury has committeed himself to any such unwise statement.
The hon. Lady the Member for Coventry, South (Miss Burton) said that the Government were taking about £3¾ million out of sport. She was, of course, quoting a figure that related to the whole of this scale of duty, whereas, so far as I am aware, none of the new Clauses is concerned in any way with horse racing or dog racing. The actual amount of tax revenue that would be affected by the first and main new Clause is about £1¾ million.

Mr. Gordon Walker: How much would it cost to get rid of the tax on football?

Mr. Brooke: That Clause would abolish the tax on sport except on horse racing and dog racing.
If the Committee wishes, I will give quickly the make-up of that sum in relation to the new Clauses. The new Clause relating to Highland games, on which the hon. Member for Midlothian (Mr. Pryde) made an amusing speech, would not cost £80,000, as I understood him to say, but directly a little more than one-tenth of that figure, say about £10,000. But, as I shall seek to show, if we were to change the law so as to exclude Highland games we should certainly, in fairness, have to exclude some other things. So the final figure would not be £10,000 but a great deal more.
The right hon. Gentleman the Member for Smethwick (Mr. Gordon Walker) asked me how much of this was concerned with football. The exemption of Association football would cost about £1¼ million, the exemption of Rugby League about £100,000, the exemption of ice hockey between £10,000 and £20,000.

But there again, if there were to be an exemption for one sport singled out like that, clearly we could not stop there and it would extend a great deal further—

Mr. Gordon Walker: May I interrupt the right hon. Gentleman, because I do not quite follow his figures? I thought the Financial Secretary said that the cost of the first Clause, which includes all these other sports, would be £1¼ million—

Mr. Brooke: No, £1¾ million.

Mr. Gordon Walker: I see, I beg the right hon. Gentleman's pardon.

Mr. Hobson: The right hon. Gentleman has said that it would cost £100,000 to exempt Rugby League clubs. In view of their serious financial difficulties, which have been proved beyond a per-adventure and are known to the Chancellor, does not the right hon. Gentleman think that it is not only paltry but bordering on meanness not to make that concession?

Mr. Brooke: The hon. Gentleman seems to be clear, before I make my speech, that I shall turn down his proposed Clause. What I was doing was not to seek to argue the matter one way or the other but to make available to hon. Members on both sides of the Committee the essential figures without which we cannot come to decisions.
The hon. Gentleman the Member for Barrow-in-Furness (Mr. Monslow) is associated with the hon. Member for Reading (Mr. Mikardo) in a proposed Clause that would give assistance to smaller occasions, if I may put in that way entertainments which would not bring in takings of more than £2,000. So far as we can calculate, that proposal would cause a loss of revenue of about £500,000, but that is bound to be a rather wide estimate. The proposed Clause of my hon. and gallant Friend the Member for Knutsford (Lieut.-Colonel Bromley-Davenport), who is concerned with boxing and would like that reduced from the second to the first scale, would cost about £50,000.
I come now to the comprehensive Clause which would exempt everything except horse races and dog races. The Committee may recollect that in days gone by there was heavy criticism of the old distinction that was drawn when athletic sports were put on to one scale of duty


and the racing of animals or machines was put on another scale. That criticism came from hon. Gentlemen opposite as heavily as from anywhere. Indeed, I thought it originated in all that pre-1952 dissatisfaction, because the existing arrangement was said to discriminate against speedway racing and the like.
It was because of this that a review of the whole duty was undertaken and in 1952 the old structure, which was a two-tier one, was altered and the present three-tier structure was created with, I would have said, a good deal of satisfaction that one of the former anomalies had been removed. In this case I see that the Opposition wishes to restore that anomaly. It wishes to exempt car racing and motor cycle racing whilst leaving horse racing and dog racing subject to tax.
9.15 p.m.
That was not, so far as I can ascertain, the kind of view that prevailed among hon. Members opposite in 1952 when the change was made. Indeed, no less a person than the present Leader of the Opposition said in the House in 1952:
I am inclined to the view that racing and mechanically-aided sports cannot be very easily distinguished from the other games and sports of which we have been speaking, and therefore I am rather inclined to share what evidently is the Government's view, that they must be treated together."—[OFFICIAL, REPORT, 6th May, 1952; Vol. 500, c. 269.]
I do not know whether those who have tabled the Clause have managed to bring their leader round to their point of view, but I am justified in pointing out to them that, unquestionably, it is in conflict with the view that he expressed and the view which generally prevailed and was accepted only four years ago.

Mr. Ellis Smith: That was four years ago. Since then there has been a General Election. We made a promise at the General Election that what is proposed in the Clause would be applied. My right hon. Friend the Leader of the Opposition has since made a speech saying that it would be implemented if we came to power.

Mr. Brooke: I know that the Socialist Party made that promise in its 1955 General Election address. At the same time it proposed other measures which

would cost many millions of pounds but gave no indication where it would get the money.
The yield of the Entertainments Duty was high in the years immediately after the war. As I explained last week, it is generally accepted now, certainly by all the delegations which come to see me, that that was in large part because there was a lack of things in the shops and other directions in which people could spend their money, but football matches and so on were available and that was where the money went, people above all wanting a change from the war.
It is not because of the Entertainments Duty that the attendances and the tax yield have fallen off since then. Between 1950 and 1954 the yield from the various forms of sport was down. Last year it appeared to be turning up again. When hon. Members claim that the Entertainments Duty is killing various kinds of sport, I must say that it is hard to maintain such an argument at a time when the yield of the duty is trending upwards rather than downwards.

Mr. H. Boardman: That probably is a statement of fact, but is not the right hon. Gentleman aware that, while there has been some increase in the case of the bigger matches, such as cup tie games, there has been a general deterioration in attendances at ordinary league games?

Mr. Brooke: What I said was a statement of fact; it was not a probable statement of fact. Let us base our arguments on what is actually happening. I was not seeking at that moment to prove that no small clubs were in difficulties. I know they are in difficulties. What I was seeking to show was that the sweeping allegations made by some hon. Members who have been carried away a little by their arguments have gone very far beyond the truth.

Mr. Hayman: Is the right hon. Gentleman aware that only a few days ago the directors of Plymouth Argyle Football Club said that it was Entertainments Duty which was likely to cause the club to close?

Mr. Brooke: It must surely be within the hon. Member's recollection that 30 seconds ago I said that I did not dispute that various small clubs were in difficulties. What I said was that various


small clubs are in difficulties and a number of large clubs are doing well. Some large clubs are doing badly and some small clubs are doing well. Does that satisfy the hon. Member?

Mr. Hayman: I do not regard Plymouth Argyle as a small club.

Mr. Brooke: A number of hon. Members challenged the present basis of the duty altogether. They were not merely arguing that we ought not to tax sport. They were directing their arguments against the attitude, taken up by successive Governments, that there is a distinction between amateur and professional sport. If I am obliged to argue that point, it will be something which has been accepted by this Committee on Finance Bills for many years. There is this distinction, on which our tax system in the last few years has been based, that there is no taxation on amateur sport, though that, of course, is not, as some people imagine, a sweeping exemption of all games and matches in which the players happen to be amateurs. It applies only where not only are all the players amateurs, but where the promoting organisation is established and conducted on a not-for-profit basis.
The Committee has on previous occasions accepted that there is a distinction between amateur sport of that kind, on whose behalf a number of excellent sentiments were expressed by various hon. Members, and professional sport, which has a commercial meaning and interest both for the players and for the organisers. I grant at once that there are many football clubs which are not making a profit for anybody, that there are no directors drawing large fees and that sort of thing. Nevertheless, it is a commercial activity and there is a broad distinction between the amateur side on the one hand and the professional on the other.

Mr. Dugdale: Can the right hon. Gentleman say whether in fact he knows of any clubs which are paying large dividends and doing the sort of things which are normally done by companies making large profits?

Mr. Brooke: I was not arguing that everybody was making a profit out of this. Of course certain people are making a profit out of certain forms of sport. Let the Committee be in no doubt about

that. I am very well aware that there are many Football Association clubs and particularly the small clubs—if the hon. Member for Falmouth and Camborne (Mr. Hayman) will allow me in the general sense to use that phrase—which are facing difficulties.
Here we come up against the same problem which we had with cinemas the other day, that one cannot draw a line of demarcation anywhere and say that everything below that line is doing badly and everything above that line is doing well. In fact we are all perfectly well aware that a number of football clubs and promoters of various sports at the moment are not meeting with all success, if I may put it at its lowest. There are many people and organisations who are not about to go bankrupt if the tax is not removed from them.
I agree at once that on the whole things are more difficult for the small clubs and organisations than for the big ones. My information is that, taking the country as a whole, the takings for admission to Association Football matches, after deducting the duty payable, were no lower in the last year, 1955–56, than they were in the previous year and were probably somewhat higher. There again, it would be quite untrue to say that the tax was killing football.

Mr. Mikardo: The Financial Secretary will not have overlooked the fact that the costs of football clubs are rising astronomically. They spend a great deal upon wages, which have been increased, and a huge amount upon travel, the cost of which has risen very much indeed.

Mr. Brooke: I hope I can convince the Committee that I have given some study to this subject.

Mr. Frederick Peart: What are you going to do about it?

Mr. Brooke: The all-sports deputation was kind enough to say that it did not find me entirely ignorant upon the question.

Mr. Peart: Will the right hon. Gentleman tell us what he is going to do? That is what we want to know.

Mr. Brooke: I thought that I might be charged with discourtesy if I did not deal at least briefly with each of the new Clauses which we have been discussing,


but in order not to keep the hon. Member for Workington (Mr. Peart) waiting, I will go forward as swiftly as I can.
I have also received a deputation on behalf of Rugby League clubs. That deputation put its position very clearly before me. Most Rugby League clubs—I must be careful not to use the phrase "smaller clubs"—are dependent upon smaller centres of population. There is no question that the tax treatment of professional Rugby League football must go along with the treatment of Association football; the two could hardly be distinguished.
Boxing has also been referred to. Here again, my information is that the gross takings in the last year or two have been higher than they were immediately before. If the proposed new Clause in the name of my hon. and gallant Friend the Member for Knutsford were to be accepted—

Mr. Ellis Smith: He is coming over to you.

Mr. Brooke: —it would cost about £50,000, two-thirds of which, I estimate, would go to promoters of the bigger tournaments, whereas I understood from my hon. and gallant Friend that it was the smaller promotions which were suffering most.
Reference was also made to speedway racing. This is a very interesting example of the truth that tax is by no means the only factor in the success or otherwise of some forms of sport. Attendances at speedway racing totalled about 6½ million immediately after the war. They rose to 12½ million in 1949, but have now swept right down to 3½ million, because speedway racing is less popular than it was, and people are more interested in stock car racing and such things.
Even though only £10,000 is directly involved, I must dwell for a few moments on the Highland games. Prizes, nowadays, are not of the order of 5s. or 2s. 6d. for which the stalwarts of the nineteenth century used to compete. With certain exceptions the Highland games of today are professional in character. I am informed that the participants are not recognised by the Scottish Amateur Athletic Association because of the substantial money prizes involved. Some games obtain exemption under the amateur sports provisions, or upon

charitable grounds, but, in view of their professional character, it would be quite impossible to exempt all these Games unless we were going to make a far more sweeping concession.
The hon. Member for Reading put down an interesting Clause, which would make a tax distinction between events according to whether or not the total receipts fell short of £2,000. Here again I must advise the Committee that there is no clear-cut distinction between the profitability of one and the other. The hon. Gentleman was perfectly right in seeing the fiscal defect in his proposal, a defect which I had to point out the other day in the case of a similar proposal for cinemas. I have been criticised in the columns of The Times by my hon. Friend the Member for Eastbourne (Sir C. Taylor), who failed to appreciate the point. It is, of course, that if the public are charged the full amount of the tax and then the whole of that tax is not later paid over to the Revenue, one is getting a hidden subsidy.
9.30 p.m.
I should like particularly to mention to the hon. Member for Reading that his new Clause would most markedly draw a line down the middle of professional football. On the whole, most Third Division clubs would be exempted by his Clause as would some Second Division clubs, but I do not think anyone in the top League would get off.

Mr. Monslow: Our Clause was designed to assist the poorer clubs. We set up an agreed scale so that they would benefit.

Mr. Brooke: The hon. Members are entitled to their own views, but when I received the all-sports deputation, one question I put was whether a change in the law of this character would be welcomed. I understood the representative of the Football League to reply definitely that the Football League did not stand for anything of this kind. I could hardly advise the House, for the benefit of Association football, to accept a scheme devised by two, if I may say so, astute hon. Members which was opposed by the Football League.
I listened with interest to what was said by the hon. Member for Coventry, South about the Chancellor taking money out of sport and not putting it back into


the Olympics. But that is getting some distance from the main purpose of this Clause, which is to abolish the Entertainments Duty on attendance at various sports. If the tax were abolished, if the revenue disappeared, there would be no question of putting the money back into stadia and the like.
I can now help the hon. Member for Workington, who has been very patient. I have been asked for the view of my right hon. Friend the Chancellor on this subject. The view which he takes was expressed, with his authority, by me on 19th April. Though my right hon. Friend is in the course of reviewing the whole of the Entertainments Duty, he would not find it in keeping with his Budget to make any change. I said also last week, when dealing with the Entertainments Duty on the cinema, that anybody who read between the lines of my statement could see from it that my right hon. Friend was not satisfied with the general arrangements for the Entertainments Duty as it stands, and that he would give careful consideration to it so that he would be ready with some new plan when he thought the proper time had arrived.

Mr. Mikardo: May I put one question to the right hon. Gentleman? Is he aware that the spokesmen for the Football League, who put a certain point of view to him which he has been good enough to quote, are predominantly spokesmen for the richer classes? Of course they do not care for a scheme designed to help the poor classes.

Mr. Gordon Walker: We have heard a niggardly and ungenerous speech from the Financial Secretary, even for a denizen of the Treasury Bench. Many of my hon. Friends will still want to express their disappointment and their advocacy of the claims of particular sports.
I support the new Clause which was moved so well by my hon. Friend the Member for Stoke-on-Trent, South (Mr. Ellis-Smith), because I feel that it would be much better to take the tax clean off sport. If any concession could be made to any particular sport my hon. Friends would welcome it as being half a loaf, and they will still urge their points of view. I quite agree with the right hon. Gentleman that the tax is clearly not the only cause of the difficulties in which

many sports find themselves but it is a very important cause, and one which can be remedied. The other causes are very much more difficult to remedy. One can isolate this cause and can remedy it at very little cost indeed.
The policy of the Government is harsh and anomalous. As even Government supporters have pointed out, this is an extraordinary tax because it falls upon a concern whether it makes a profit or a loss. Indeed, it very often eats up all the profit and turns a profit into a loss. This is particularly grave in certain sports. Not only is it harsh in this way but it has been made very anomalous since the late Chancellor of the Exchequer exempted cricket and amateur sport. We were grateful for those two exemptions on the basis that half a loaf is better than no loaf, but it has resulted in making the whole thing an unjust and unfair muddle.
The distinction between amateur and professional sport is an impossible criterion to go by especially now that cricket his been exempted. As my hon. Friend the Member for Ince (Mr. T. Brown) said, one cannot distinguish between cricket and Rugby League football in this respect, because once cricket has been exempted the distinction between amateur and professional as a criterion for tax ceases to be applicable or sensible. When the Financial Secretary talks about the difficulty of drawing lines, I remind him that none of the lines which we have suggested he should draw is nearly as difficult as the line which he is drawing between cricket and professional sport.
The arguments used by the Lord Privy Seal when he was Chancellor to justify the exemption of cricket apply very much more widely, as my hon. Friend the Member for Stoke-on-Trent, South said. The previous Chancellor said that it was because cricket was hard up; there are lots of professional clubs, even important ones, that are extremely hard up. He said that the exemption would not cost very much, but as the right hon. Gentleman has just been showing us, some other exemptions, like that for the Highland games, would cost infinitely less than the exemption for cricket, which cost about £80,000 a year.
The Lord Privy Seal made a great deal of play about cricket being the traditional


game for the country, but I think he meant that it was a gentlemanly game; that was the real distinction he was making. I am a great cricket fan and love watching cricket, but I would not dream of making the exemption on that basis. Cricket is not nearly so traditional a sport as some others. Football has a great claim to be both older and to be based on a longer tradition.
Perhaps the best measure of the Britons' love of a sport is the date at which Governments have tried to prohibit it. Football was prohibited in the Reign of Edward II. Cricket did not get prohibited until a great deal later, namely in the reign of Edward IV. Football is a more traditional as well as a more popular game. Governments in those days always tried to stop the popular things.
It is not possible to sustain the point about cricket being a bond of the Commonwealth against other games like Rugby League and Rugby Union, and, of course, Association football. Football Association teams go to Australia, New Zealand, Canada, South Africa and the West Indies, to just as many Commonwealth countries as our cricket teams. In the main, they go at a loss, and the loss has to be paid for by the profits on Cup ties and so forth. Of course, the tax—

Mr. Hobson: Is it not a fact that Rugby Union football is exempt from tax whereas Rugby League is not?

Mr. Gordon Walker: I quite agree with my hon. Friend that the anomaly is quite indefensible. I think my right hon. and learned Friend the Member for Rowley Regis and Tipton (Mr. A. Henderson) pointed out that Wimbledon tennis and the Test matches are tax-free, while the Cup Final has to pay over one-third of its takings. The two Rugby games are, of course, rivals. One is more profitable than the other. The less profitable one is taxed and the other is not. It is an extraordinary and anomalous position.
We have been told by the right hon. Gentleman that the cost of the major concession would be £1¾ million. That would be very little to the Treasury, but an enormous amount for sport. It would make an enormous difference to sport. It makes the Government look like a Government of kill-joys when, for the sake of £1¾ million, they deny this great

boon at practically no sensible cost, no cost which could be measured in the terms of present-day Budgets, but which would be of immense value to sport. The concession would cost about as much as the concession the Chancellor is making to rich people—people earning £5,000 to £7,500 a year—in an Amendment to Clause 19. If the Chancellor had not made that concession he would be able to make this one to sport at no cost whatever.
This tax is on the sport and enjoyment of the people. It is not only stifling the great spectacles but the actual playing of these games in the smaller clubs which very often are sustained by organisations which make their money out of the big professional games. As my hon. Friend the Member for Coventry, South (Miss Burton) pointed out, it is damaging the nurseries of sport, and that is a very grave thing to do. This has nothing to do with the commercial aspects of sport, but with sport itself. In all cases the organisations which run these games use the profits from the big spectacles to finance and encourage smaller clubs and the nurseries of sport.
That is why we said in our Election manifesto quite clearly and flatly that we shall abolish the tax on sport. We stand by that. Had Labour won the last Election this tax would be being abolished in this Budget. It will be abolished after the next Election when we are back in office and carry out our intentions.

Mr. Peart: I wish to say how disappointed I was with the reply of the Financial Secretary. We were concerned because we had the feeling that, in the end, he would offer nothing to the clubs affected by this taxation.
I say quite frankly that I am making a constituency speech, because Workington has a Third Division soccer side which did very well indeed last season and we have also built a fine Rugby League side, which has established a tradition. Workington is concerned with this matter and is affected by the taxation measures of the Government.
Also, in Cumberland, I am pleased to say, we have sympathy with the view which has been expressed by my Scottish colleagues about the Highland games. In Cumberland, we have professional games which are held in great esteem not only by Cumbrians but by


people who travel from afar. I have a special constituency interest in this matter. I am sure that people who run Rugby League and Association football teams will be shocked and disappointed by the speech of the Financial Secretary.
No doubt the party opposite is saving up for the General Election and perhaps we may have a windfall then, but we on this side of the Committee feel that the Chancellor could do something about this question now. From the figures given by the Financial Secretary, if the major Clause were accepted the sum involved would be £1¾ million. If the Clause affecting only football were accepted the amount would be £1¼ million. If an Amendment were agreed to dealing only with Rugby League football, as my hon. Friend the Member for Keighley (Mr. Hobson) said so vigorously, the amount would be only £100,000. This is chicken feed compared with other amounts in our national economy.
Sport is not something that can be dismissed. [Laughter.] It is no use hon. Members opposite laughing about it. The benches opposite have been empty all through the debate, and, of course, hon. Gentlemen opposite do not attend Association football matches or Rugby League matches. They have probably been at Wimbledon watching tennis—

Mr. Gordon-Walker: Or at Wentworth watching golf.

Mr. Peart: We on these benches are more concerned about sport affecting people in the great industrial areas, such as Rugby League football.

Mr. Sidney Dye: And in the rural areas.

9.45 p.m.

Mr. Peart: Yes, and in the rural areas. I know that my hon. Friend is a supporter of Norwich City, a Third Division Southern club, which would benefit if the proposals of the Labour Opposition were carried. So we say that the Chancellor and his party should do something about it.
I will not deal with the anomalies; we know they are there. We see our great sporting spectacles, like the Amateur Cup Final and the Wimbledon tennis, exempt from taxation. Fashionable clubs like Bishop Auckland, in my own native

county of Durham, and southern amateur clubs, are exempt from taxation, while the minor professional clubs, not in the Third Division—and I know many of them in the north of England which act as feeders, in the main, of the professional clubs—small professional clubs which have been run in the mining towns and villages, are subject to severe taxation. Surely, there is an anomaly which has been pressed over and over again by many of my hon. Friends.
The matter should be looked at again, and I had hoped today that the Chancellor might have made a concession. I would have been prepared to accept the Government's decision if I knew that all this taxation went into the provision of sports facilities, playing fields and athletic running tracks. As my hon. Friend the Member for Coventry, South (Miss Burton) has said, we need much more money for this purpose, especially if British sport is to play a leading part in world competition. If this revenue had been filtered away in that direction, I would have been prepared to accept the proposals of the Government, but we know that that is not the case.
Therefore, I say even now, at this late hour, that the Chancellor should look at this matter again. He does not need to have a review of taxation. After all, it was his Government which made one concession to Rugby Union and cricket, and his Government which made the taxation concession to amateur sport. Surely he could make a further concession now. Even if he accepts the moderate proposals put forward by my hon. Friends the Members for Reading (Mr. Mikardo) and Barrow-in-Furness (Mr. Monslow), and does not accept the main case for exemption, it would benefit the football clubs and the Rugby League by £½ million. I am sure that the Chancellor could have done it tonight, and I wish he would look at this matter again, since there is deep feeling on the subject. I hope that my hon. Friends will go into the Lobby against this policy of the Government.

Miss Margaret Herbison: I wish to support my hon. Friends in the plea which they have made to the Chancellor of the Exchequer. I support the main items in the new Clause which has been moved, but I shall speak particularly to the new Clause which


deals with Highland games, to which, so far, only my hon. Friend the Member for Midlothian (Mr. Pryde) has spoken. I hope I may have the Chancellor's attention, because the Financial Secretary wearied us almost to tears with the time he took to say very little about the new Clauses. When he turned to the Highland games he said he wanted to deal with the subject for a moment, and he dealt with it in a most perfunctory way.
The right hon. Gentleman made no reference at all to one part of the Clause on highland games; he wiped the subject completely out of his mind by saying that most of these games were professional games. In the new Clause in the names of my hon. Friend the Member for Midlothian, myself and other hon. Members we have asked that there should be consultation in order that decisions could be made from time to time which Highland games could be exempt from Entertainments Duty.
The Financial Secretary said that all the Chancellor gets from the taxation of Highland games is £10,000. What a miserable sum! Yet the Financial Secretary tells us that he cannot afford to do without it. In my constituency we have important games each year. They are non-profit-making in every sense. The men and the women in my constituency get no profits at all from these games. They give up much valuable time not simply for a week before the Highland games, but from one Highland games to the next; these men and women work to make them a success, not only for the big village in which they are held but for a very wide area of Scotland.
They have told me time and again that if this taxation continues they will be forced to give up these Highland games, and that applies not only to the Highland games held in Shotts, in Lanarkshire, but to those in many parts of Scotland.
It seems to me that these Highland games help to bring out the best in many of our people. If I have one criticism of the way of life in our country today it is that far too many of our adults and young people are spectators and far too few take part in doing and playing, which, I think, would be a much better way of spending their leisure time.
In the Highland games we have those who provide music from the pipe bands.

Bands attend from many parts of Scotland and the young men, and sometimes the young women, give up much of their time throughout the year to learn how to play the pipes. They are doing something which not only brings satisfaction and pleasure to themselves but also gives satisfaction and pleasure to many others.
We also have young women, and sometimes young lads, who take part in what I might call the folk dancing of Scotland—our Highland dancing. That is not merely something performed at Highland games; it is performed throughout the year in our villages nad towns, attracts our young people and gives them a form of leisure entertainment in which they take an active part and are not simply spectators. It seems to me that it is a good thing for the Government to encourage that way in which to pass one's leisure.
We have many types of athletics at these Highland games, and, again, it seems to me to be important for us to give all the encouragement we can to our young people to take part in athletics throughout the year. The Highland games prove an incentive to all of those things about which I have been speaking. This tax that is imposed on Highland games has already stopped those games in some of our Scottish towns and villages, and I am informed that before very long there will be very few Highland games held anywhere in Scotland.
I am surprised that no Scottish Member on the other side of the Committee has spoken on behalf of this Clause. I am even more surprised that every Scottish Highland Member is not in his seat this evening, supporting us in our plea. The Financial Secretary made no case whatever this evening for turning down this modest claim that we are making for our Scottish Highland games. If the Chancellor of the Exchequer is to reply to what we might call the "second half" of the debate, I hope he will be able to tell us that this sum of £8,000 to £10,000 is to be given to our Scottish people to foster all of these things which I think are among the best in our Scottish life.

Mr. Lewis: I have sat here for the whole of this debate. I have heard every speech that has been made, and I must say that all of the speeches from this side and the one speech from the other side


of the Committee, excluding the Ministerial reply, have been excellent.
I support in their entirety the various points of view that have been put forward, including the speech by the hon. Member for Heston and Isleworth (Mr. R. Harris). My only regret is that that there were not more hon. Members opposite present during the early part of the debate. As my hon. Friend the Member for Lanarkshire, North (Miss Herbison) has said, one would have expected that some of the Scottish Members on the opposite benches would have supported the Clause relating to Highland games.
In the few remarks that I have to make I should like to introduce a new argument. I support all of the suggested Clauses, although, frankly, I do not think they go far enough. I suggest to my hon. Friend the Member for Stoke-on-Trent, South (Mr. Ellis Smith) that there is no reason or logic in his Clause for excluding
sports other than entertainments consisting wholly or mainly of horse-races or dog-races.
We have heard a lot this afternoon from hon. Members interested particularly in Rugby football and Association football about the desirability of enabling one's club to get to Wembley for either the Rugby League cup final or the F.A. cup final. My hon. Friend the Member for Coventry, South (Miss Burton) referred to the necessity for providing sport with financial assistance, but she might bear in mind that the Olympic Games were only held at Wembley because of the financial support that Wembley gets from greyhound racing.
I know that many hon. Members here probably do not like greyhound racing. Here I will declare an interest. I have a greyhound track in my division, although it is not the Wembley track. It is a fact that this great cup final, which every hon. Member hopes to attend—[Interruption.] If the hon. Member for Barry (Mr. Gower) had been here earlier, he would appreciate the point of this debate, namely, the desire of football and rugby supporters to get their teams to Wembley to take part in the cup final.
10.0 p.m.
I want to point out that these matches could not otherwise have been held at Wembley. Does anyone really think that the huge Wembley Stadium could be left from year to year for the purpose of having the F.A. Cup final or perhaps one

or two international games? Of course it could not. The returns which come in to pay for those games are from greyhound racing. It is similarly true concerning athletics.
I was pleased to hear my hon. Friend the Member for Coventry, South say that we should encourage our Olympic teams. I agree that we should. We should give our support to football, cricket, rugby and all sports, including athletics. She mentioned the lack of running practice and lack of facilities and assistance. She could have pointed out that the athletics which go on at the White City are not paid for by those who follow that sport. Again, they are paid for by those who go to greyhound racing.
Let me give an example. One company which goes in for greyhound racing paid £1,600,000 in tax to the Treasury and it paid to its shareholders dividends amounting to £60,000. The reason that it is possible to run these athletics—Pat Smythe with her horse jumping, the searchlight tattoo and S.S.A.F.A. show—is because each week there is, in fact, this greyhound racing which appears to be frowned upon by the Treasury.
The hon. Member for Heston and Isleworth, who is not in the Chamber now, mentioned the argument of inequality. It is not inequality that we have. It is discrimination against small Association football and Rugby football clubs and also discrimination against the working man who, rightly or wrongly, decides that his form of amusement is greyhound racing. What is the position? He is in the unfortunate position of having to pay 30 per cent. Entertainments Duty and also the special 10 per cent. tax, and he is, of course, in the position of having a deduction of 6 per cent.—

The Deputy Chairman (Sir Rhys Hopkin Morris): The hon. Gentleman is arguing about greyhound racing, but that is not included in the new Clause.

Mr. Lewis: I was speaking, Sir Rhys, against the new Clause and I was pointing out that it excludes certain sports.
I was suggesting that this exclusion, if the new Clause were implemented, would carry on the other anomalies which the new Clause proposes to abolish. I was going on to explain that it is because of the excessive taxes which these types of sports are paying that there is now the


position of a lower tax being charged on football and these other sports.
I therefore suggest to the Chancellor that if, as it appears, he cannot see his way to accept either the new Clause which deals mainly with football, or any of the other new Clauses, he should try to introduce a method of taxation of these sports on an entertainment basis and on a fair and equitable level.
The present position is that if a man wants to watch a football match he pays a certain percentage of Entertainments Duty, but if he chooses to see a private, amateur show, or if he goes to Wimbledon, he pays no tax at all. If he wants to watch ballet for his amusement, or if he goes to the opera at Covent Garden, he pays no tax but is subsidised from the Entertainments Duty paid by those who watch sports and other forms of entertainment.
I ask the Chancellor to level this out, to treat them all alike and to try to ensure that every type of entertainment is properly dealt with. The present system is farcical. Not only are there different rates of duty for different types of sport and entertainment, but some are excluded. We have the absolutely ludicrous anomaly that if a person watches professional football, at, say, the Arsenal, he pays a tax, but if he stays at home and watches the same match on television he pays no tax at all. It is true that he pays a licence fee, but he pays nothing in actual tax to the Treasury.
Perhaps the Chancellor will promise that he will not hold back a concession until just before the next General Election. Many of us believe that he would be willing to do it now if he could be, sure that an Election was coming. I ask him not to wait, but to do it now.

Sir David Robertson: Hon. Members opposite have shown interest this year and last year in the taxation of Highland games and have accused Highland Members, of whom I am one, of taking no interest in the matter. That is wholly wrong. Long before any hon. Member opposite examined the problem of Highland games we took an acute interest in the matter when they themselves were in power. Our view was influenced solely by the fact that professional vaudeville artists, high-

land dancers, heavyweight athletes, and a circus of professionals, who began probably in the Lowlands, in Dundee or somewhere else, and eventually moved up to the Highlands, take part. They are performers. They are paid either directly in salaries or in high prize money which they probably share.
As long as that state of affairs prevails, what possible excuse can there be for charging Entertainments Duty to the football attender in Glasgow, who goes once a week to follow his game, and not charging the man in Dornoch, Wick or any other place in the Highlands his share of tax for one day in the year?
The hon. Lady the Member for Lanarkshire, North (Miss Herbison) said something that we all support. She likes boys to be trained in piping and girls in dancing, and they are. When entertainment of that kind is provided, where they are competing for small money prizes, small, modest prizes, my understanding is that the Chancellor would make no charge at all for Entertainments Duty in those circumstances. It is this professional element, which seems to be highly remunerative, which is wholly contrary to the real traditions of Highland games. I am quite certain that all of my colleagues who have the responsibility of representing the Highlands strongly support the Government on this issue.

Mr. J. P. W. Mallalieu: There was a time, long ago, just before the Financial Secretary began his interminably tedious speech, when I thought that something would result from this debate, because the Chancellor of the Exchequer was sitting on the Front Bench opening and shutting a brown file which was marked in large letters, "Action". Unfortunately, the right hon. Gentleman eventually shut up the file and sent it back to the Box. I wish that he had kept the file and sent the Financial Secretary back to the Box, because the Financial Secretary made no serious attempt to deal with the debate and with the points that were put to him.
The right hon. Gentleman did not deal with the main point which was made from his own side of the Committee against the Entertainments Duty as a whole, namely that it is a bad tax because it is a tax on receipts and, being a tax on receipts, can drive concerns which we want to foster into losses or even into


bankruptcy. If the Chancellor had listened to the whole debate, he would have heard from time to time examples of the great difficulties into which various sporting concerns were being driven in part by the Entertainments Duty, but the Financial Secretary did not deal with that point. He preferred just to mull over again the old discriminations which speeches from this side of the Committee have shown quite clearly to have really no validity at all.
There is the discrimination, for example, between amateur and professional sports. The right hon. Gentleman probably does not know that many of the so-called amateur clubs are far more prosperous than their professional brethren. I should hate to mention this in the presence of my right hon. Friend the Member for Bishop Auckland (Mr. Dalton), but there is very little difference in some sports between the amateur player and the professional player. The only difference that I can see in some sports is that the professional player gets his payment directly above the counter. Then mention has been made of the discrimination against sports on which there is gambling, for example, racing. But when we get landed into that, we find ourselves trying to stop or penalise the Boat Race, a very amateur sport on which there is a considerable amount of gambling.
All these discriminations have simply created more and more anomalies, all in order to mitigate the effects of a tax instead of removing that tax altogether. If the Chancellor is seriously going to look at this subject, I think that he will find in the course of the next twelve months no argument whatever for continuing the tax as it has been continued for many years. If, having listened to part of the debate, the right hon. Gentleman could say, "It is not, after all, a very large sum of money. I can get rid of it," he would give a great deal of stimulus to a large number of entertainments and sport on which, to a considerable measure, our physical well-being and our pleasures depend.

Mr. Dye: In the course of listening to the debate, I wondered whether the eloquence that was being poured forth, mainly from this side of the Committee, would be like water on a duck's back.

When I listened to the Financial Secretary's reply, I thought that he made extremely heavy weather of it. He was like a dying duck in a thunderstorm. He had really little to say. His long statement led us nowhere. We gained from it only the fact that the taxation which my hon. Friend the Member for Stoke-on-Trent, South (Mr. Ellis Smith) wants to see repealed yields £1¾ million.
10.15 p.m.
I agree with the right hon. Gentleman that this would cost £1¾ million. What do we set against that? The interest of the great mass of our people in weekly sport. Not only is it a question of attendance at sport; there is the further encouragement of our young population to take part in and to be associated with sport. That in itself is a good thing to encourage, but if we are to tackle the problem of juvenile delinquency we must interest those young people in something worthwhile, and there is nothing better for them than exercise, recreation and sport. If, therefore, by a repeal of the Entertainments Duty on sport the large and the small clubs could use the money which now goes in tax on encouraging young people to take a greater interest in sport and to help to equip them for it, that would be of advantage to the nation.
It has been put to me that we have listened to the appeal of hon. Members from the big industrial areas. This applies to the rural districts just as much; in fact, the people who travel from our villages to see games on a Saturday have to pay far more in travelling expenses and lose more time than those living in the big industrial areas. Therefore, it is an advantage in a county like Norfolk to have Norwich City Football Club operating there. We know that the people associated with that club go out into the villages and help to develop the latent talent there, and then the big clubs from the cities come and buy them out—

The Deputy-Chairman: The hon. Member seems to be straying from the taxation point.

Mr. Dye: With great respect, Sir Rhys, the point is that the professional football clubs now find themselves in the position that, if they were relieved of Entertainments Duty, they would be able to meet their obligations and could extend their activities for the benefit of the growing generation.
I was going to say that Norwich City is doing this for the villages of Norfolk and Suffolk. If I may give one instance to make my point, Sir Rhys, a schoolboy international who played for England this last year was greatly helped to develop by officials and others in the Norwich City Football Club. If now, as I want to show, the Norwich City Football Club is losing money, then the repeal of Entertainments Duty would not only assist that club but also many other Third Division clubs.
It is a question of doing this now, not in two or three years' time when these clubs have been milked of their reserves and are unable to continue. So it is an urgent matter, one about which we want to see our sporting clubs assisted from a national point of view. We want to see sport widely diffused amongst all our people so that the high standards of the professional clubs can be used to assist the bulk of our growing population.

Mr. Barnett Janner: I do not propose at this hour to enter into any further argument about the general points which have been made, except to say that I was disappointed at the peculiar type of reply given by the Financial Secretary. He wandered through a lot of points, kept the Committee waiting to hear what he was going to do about it, and eventually decided that he would tell it that he was going to do nothing, and he did not say that in as pleasant a way as he might have done.
There is one thing that I want to ask the Chancellor to reconsider. His predecessor rightly said that he would not allow a sport to disappear if the Treasury could help it, stating that he had to be satisfied first of all that the sport was unable to survive under the strain of the tax imposed. I have an instance of a sport which is definitely going to the wall, and, unless the Chancellor does something, will disappear in a very short time. I refer to boxing.
Hon. Friends of mine have commented upon the fact that few hon. Gentlemen opposite have taken much interest in the debate. The Chancellor has not even taken notice of his hon. and gallant Friend the Member for Knutsford (Lieut.-Colonel Bromley-Davenport), who has at the moment disappeared from the scene. [HON. MEMBERS: "One hon. Gentleman opposite is

asleep."] I have no desire to awaken the hon. Member for Galloway (Mr. Mackie), who has evidently decided to take no further interest in the proceedings; perhaps he will not vote either.
I could understand it if the Chancellor wanted the sport of boxing to disappear. My hon. Friend the Member for Warrington (Dr. Summerskill) has a certain attitude towards boxing, about which I think she is wrong, but, if she were in the Chancellor's place, I could understand her saying that she wanted to destroy the sport because she did not agree with it. However, that is not the Chancellor's position. Like some of my hon. Friends, the Chancellor and his predecessors have felt that boxing should not disappear.
I want to give one or two figures which may assist the Chancellor, even at this late hour, in coming to a different conclusion from that to which the Financial Secretary came a little while ago. I understand that a recent boxing tournament paid £11,000 in taxation and was run at a loss, the tax being much too heavy for an entertainment of that sort to bear. I am told that there are now only six regular promoters of boxing tournaments. The small promoters have practically gone out of existence. In 1952, under the old rate of tax, there were 708 tournaments, 648 being commercial and 60 charity tournaments In 1955, under the new rate of tax, there were only 341 tournaments, of which 293 were commercial and 48 charity tournaments.
It is obvious that if boxing continues to suffer the severe strain at present imposed upon it, it is ultimately bound to be forced out of existence. We were given an assurance that that would not be permitted. I should like the Chancellor to let us know whether he really intends to drive the sport out of existence and so deprive himself of a very substantial income, or whether he intends to reduce the tax to enable the sport to continue, with the consequent result that not only will he be able to give a considerable amount of enjoyment to those who participate in it, but also afford the Treasury some kind of revenue which he will ultimately lose if the sport disappears.

Mr. John Hall: The hon. Member is suggesting that the tax on boxing will


destroy boxing as a sport. Does he suggest that a tax on professional boxing will destroy amateur boxing?

Mr. Janner: I think that that is generally conceded, because in many cases the amateur proceeds to professional boxing. [HON. MEMBERS: "No."] That is the position. If the small promoter is driven out, we will have neither amateur nor professional boxing in anything like a substantial way.
If the Chancellor believes in boxing, it is not worth while incurring that possibility from the point of view of boxing, or from that of the Treasury. If he cannot concede all that is being asked in these Clauses, I appeal to him at least to consider some kind of reduction which will enable this and other sports to continue and not to be driven into a position which will entirely destroy them.

Mr. John Henderson: The observations made by the hon. Member for Huddersfield, East (Mr. J. P. W. Mallalieu) must not go unchallenged. He said that there was not much difference between amateur and professional football, other than a pay packet being handed over the counter to the professional footballer. That statement made in the House of Commons must be contradicted, because it is a slur on a great band of sportsmen whose only interest in the sport is enjoying or watching a game of football as amateurs.
In my constituency, there is the largest football stadium in Great Britain and perhaps one of the oldest football teams in Great Britain, Queens Park. I shudder, and I am sure that many friends of amateur football will feel ashamed to think, that any hon. Member should cast the slur that the only difference is a pay packet going over the counter, instead of below the counter. I want to take the opportunity of resenting that.
The hon. Member for West Ham, North (Mr. Lewis) made a most eloquent plea on behalf of dog racing. I understand that the actual amount of time of dog racing is eight or ten minutes. Not much time is devoted to the sport, whereas an enormous amount of time is devoted to compiling the book.

Mr. Lewis: The hon. Member has misunderstood my point, which is that if a person desires to spend his free time in

that type of entertainment there is no reason why he should have to pay 50 per cent. tax, whereas another person who desires to go to the opera or ballet not only pays no tax, but is subsidised by the very man who goes to greyhound racing.

10.30 p.m.

Mr. Henderson: Nevertheless, I think it would be a fair statement to make that the hon. Member has more than a passing interest in dog racing because he mentioned that there is a dog racing stadium in his constituency. For the life of me, I cannot understand anyone who is kindly disposed to dog racing going into the Division Lobby against Premium Bonds. I cannot understand that.

Mr. Lewis: The hon. Member is wrong. I did not go into the Division Lobby to vote against them.

Mr. Henderson: I gladly withdraw. I apologise to the hon. Member. However, many of his hon. Friends did vote against them.
I do not want to detain the Committee. I wanted only to say what I have said about amateurs and professionals, and to protest against the inconsistency, evident in hon. Members opposite, of wishing tax relief for dog racing but voting against Premium Bonds.

Dr. Edith Summerskill: I have no intention of keeping the Committee more than a few minutes, but I should not like it to be thought that my hon. Friend the Member for Leicester, North-West (Mr. Janner) reflected the opinion of all of us. I find it difficult to understand how he can identify the sordid business of prize fighting with the other sports which have been mentioned. Of course, I support everything that has been said so far as real sports are concerned, but the business of prize fighting is an entirely different matter.
I am impressed by the temper of the Committee as I rise to speak on this subject tonight. About the same time of night, four years ago, when I rose to speak on this subject on a similar occasion, I was interrupted by noises of every kind. The hon. and gallant Member for Knutsford (Lieutenant-Colonel Bromley-Davenport) shouted. [HON. MEMBERS: "Where is he?"] Even my right hon. Friend the Member for Easington (Mr. Shinwell) refused to allow me to speak.


My hon. Friend the Member for Liverpool, Exchange (Mrs. Braddock) weighed in against me. The noise was such that I found it difficult to make myself heard at all. I think the atmosphere tonight indicates that the temper of the Committee in this matter is changing, and I believe that the speech of my hon. Friend the Member for Leicester, North-West found little sympathy on either side of the Committee.
My hon. Friend pleaded for a business. Indeed, I was astonished that when the hon. Member for Wycombe (Mr. John Hall) opposite intervened, and asked my hon. Friend whether he was speaking about amateur boxing, my hon. Friend revealed that the business for which he was speaking regarded amateur boxers as its source of supply—

Mr. Janner: Do I understand that my right hon. Friend pleads for amateur boxing but does not agree with professional boxing? Is that what she is driving at? It would be interesting to know.

Dr. Summerskill: My hon. Friend must not lose his temper.

Mr. Janner: I am not.

Dr. Summerskill: He has put the case for the boxing promoters—

Mr. Janner: No, for the British Boxing Board of Control.

Dr. Summerskill: —those men who exploit young men, those men who, after years of exploiting these young boxers, find themselves financially better off, their health unimpaired, while the health of the young men they have exploited has definitely deteriorated. Furthermore, this sordid business is being brought right into the homes of the country on television. There is not one hon. Member, I believe, on either side of the Committee, who can be proud of the scenes as they are either portrayed on television or reported in our newspapers.

Mr. Lewis: On a point of order. Seeing that my hon. Friend the Member for Liverpool, Exchange (Mrs. Braddock) has just arrived, would it be in order for my right hon. Friend to repeat her last few sentences, because I did not hear them and, I am sure, other Members of the Committee did not hear them? To continue the debate properly, per-

haps we could ask my right hon. Friend to repeat what she said.

The Temporary Chairman (Mr. H. Hynd): I do not think that that is necessary.

Dr. Summerskill: I assure my hon. Friend that I have no desire to indulge even in verbal battle. All that I am anxious to put is a rational case.
I think I know the minds of hon. Members enough to realise that what I say today will be received in the manner in which I hope it will be received. I believe that our civilisation is evolving. I believe that the sordid displays which we are compelled to see should be condemned by the House of Commons, and I am convinced that in a few years' time the House will condemn them. I believe that it will be unnecessary to introduce legislation, but I also believe that one progressive Chancellor of the Exchequer after another will refuse to do as my hon. Friend suggests and reduce the tax on prize-fighting. In this way, prize-fighting in this country will die of its own accord.
Other people in the House, years ago, have appealed to the House to reject other brutal so-called sports. They have been rejected because the House of Commons has what is characteristic of the British people—common sense. People know that this is an undesirable business, undesirable from the point of view of the active participants and undesirable for those who view it. Therefore—

Mr. James Johnson: Can we have this said quite clearly? Is my right hon. Friend objecting to fighting for money, or is she objecting to A.B.A.—amateur—boxing and even boxing in schools and the A.T.C.?

Mr. C. R. Hobson: And in the Boy Scouts?

Sir Charles Taylor: On a point of order. Would it not save the time of the Committee if the party opposite settled its differences in private?

The Temporary Chairman: We are only discussing whether we should reduce the tax on boxing.

Dr. Summerskill: The hon. Member for Eastbourne (Sir C. Taylor) need not worry. He has interrupted me on many occasions in the past, always at this time of night. He always arrives at about a quarter to eleven. I am so confident that


my point of view will finally prevail that I never lose my temper or get irritated by him.
All I have to say to my hon. Friend the Member for Rugby (Mr. J. Johnson) is that what he has asked is completely beside the point. We are discussing the tax on prize-fighting and not amateur boxing.

Mr. Johnson: We are discussing the Entertainments Duty.

Dr. Summerskill: I have no desire to entertain the Committee—[Laughter.] Frankly, that is the right expression. Many hon. Members have heard me put this case on other occasions. An entirely different atmosphere prevails tonight, for which I am profoundly grateful. I am quite certain that in a very few years' time there will be no further necessity for me to intervene in a debate such as this.

Mr. James MacColl: I am sure that my right hon. Friend the Member for Warrington (Dr. Summerskill), with her strong views about boxing, must feel very happy at the thought that it is now open to her to see an entirely clean, gentle and manly sport, in which Widnes will beat Warrington at Rugby League football. There, at least, she will see no display of unnecessary violence. She will see a game fought to a fair conclusion, with due regard to the rules of the game and the courtesies of the contest.
Some of my hon. Friends with much more political wisdom than I have suggested that the Chancellor is completely convinced about the need to do something, but is postponing the operation until some time rather nearer the next General Election. If that be true, all I would say to him is that he will leave it too late because, by the time the Election comes along, many of the most famous Rugby League football clubs will have found it necessary to close down.
The right hon. Gentleman did me an honour—and I think that he assisted me—by coming to my constituency during the previous Election campaign. If he comes again into Widnes, having succeeded in killing a Rugby League football club which nearly died last season, and was prevented from doing so only by people rallying round to get it through to the end of the season, he will

find a very warm reception waiting for him—a reception which will melt the heart even of my right hon. Friend the Member for Warrington towards him. He will become the victim of what may prove to be a violent display of opposition to him because of his lack of appreciation of the seriousness of the situation.
Whatever may be said about the arguments of the Financial Secretary upon the subject of other sports, it is relevant to point out that he made no attempt to make a case for the maintenance of the tax upon Rugby League football, or to suggest that such a tax was fair. All he could say was that we must treat this sport in the same way as we treat Association football. That is no argument for destroying a sport which is played and watched with very great enthusiasm and devotion by people in small towns, and followed essentially by people in small industrial towns in Lancashire and Yorkshire.
The Financial Secretary produced a quite astonishing argument. He mentioned that the yield from Entertainments Duty was rising. It is surely an extraordinary proposition, when the yield from a certain tax is increasing, to say that the financial situation is so acute that nothing can be done about it. Surely the rise in the yield is an argument for taking the opportunity of lessening the impact falling upon these small clubs, in whose case the tax is having a lethal effect and driving them out of existence.
If the proposed new Clause moved by my hon. Friend the Member for Stoke-on-Trent, South (Mr. Ellis Smith) cannot be accepted, I submit that the one suggested by my hon. Friend the Member for Reading (Mr. Mikardo) points the way out of these difficulties. His proposal seems a practical one, which would certainly help the small clubs which cannot, in the nature of their situation among small populations, ever hope to get really big gates. So that they can get upon their legs and provide decent conditions for their players and have reasonably equipped establishments they should be given the concession to which may hon. Friend the Member for Reading has pointed the way.

10.45 p.m.

Dr. J. Dickson Mabon: The general argument of the speeches of my


hon. Friends calls for an end to the anomalies in this tax. We have seen a complete rejection of this plea on the part of the Government. It is to the question of Highland games that I wish to address myself.
So far, we have had two or three comments in answer to the arguments advanced by my hon. Friends the Members for Midlothian (Mr. Pryde) and Lanarkshire, North (Miss Herbison). First, we had the outrageous argument of the hon. Member for Caithness and Sutherland (Sir D. Robertson), who might well be termed a Glasgow Highlander, as he was born in the same city as myself and represents a Highland constituency. The hon. Gentleman put forward the most pernicious argument I have heard for refusing this concession for the Highland games. He said that one reason for refusing it was because there are professional athletes who go round to the various games.
We have nine major games in Scotland which occupy a day or two days at the most, and there are smaller games in the counties where Highlanders have been drawn because of the industrial revolution of our time. There games offer the same facilities and no one could argue that it is possible for professional athletes to make a living by going round to the various games. I put it to the hon. Gentleman that he has done a great disservice to Scotland by advancing that argument.
The Financial Secretary to the Treasury said that it was not an £80,000 concession that Scotland was seeking, but an £8,000 concession. I may say that I am not making a constituency case, but a national case—the case for Scotland. After all, Scotland is an integral part of the United Kingdom and deserves this recognition of her national traditions, which are as honourable and ancient as those of any other part of these Islands. The point has been made that we are not seeking a concession of £80,000 but £8,000, and this has been used as an argument by the Financial Secretary for not accepting the fact as it is.
The second argument of the right hon. Gentleman was that were this concession given to the Highland games, we should have to cut out other things. What other things? The right hon. Gentleman did

not tell us what were the other things in the same category as the Highland games. The appreciation of the Highland games by many hon. Members extends to their having seen the film "Geordie". That is their experience of the bardic and athletic pursuits of Scotland. It must be recognised that the Highland games are not a professional athletic meet. There are essentially the ground on which athletes, amateur as well as professional, compete, and at which people also compete in dancing and piping and various other cultural pursuits. The Highland games are misnamed for the appreciation of Englishmen. They should not be called games at all.
The Mods, like the Eisteddfod, are exempted, or ought to be exempted, though application has to be made for exemption from the various impositions of this tax. But in the case of the Highland games, because they are called games, they fall foul of this fantastic duty. With such a long tradition of culture behind these games, it seems unfair that a concession should not be given which, after all, would involve only £8,000.
There is the argument about anomalies, but this whole field of taxation is full of anomalies. An anomaly was created when the concession was made to cricket. That is the answer to the hon. Member for Caithness and Sutherland. The fact is that the position becomes quite indefensible now that the concession has been given to cricket.
I was interested to learn that the history of cricket can be traced back to the days of Edward IV and that of football to Edward II. But the origin of the Highland games can be traced back to the time when the Greeks played their Olympic games, and some of us like to think that their history goes even further back than that.
We have always insisted that these games have represented gatherings of many people in different parts of the country. Their names still ring loud and clear in Scotland. Those people are meeting, not for professional purposes to make money, but as an expression of their national culture which, I am sad to say, is not so vigorous, so staunch and so fine as we see among our Welsh friends because Scotsmen, among hon.


Members opposite particularly, have neglected to defend the heritage of Scotland. It is left to us once again, as throughout the long years of Scotland's history, to speak up in defence of the people's heritage and ask the Chancellor to make this gesture of fairness.
One of the privileges of office is to distinguish between these things. One year it was cricket and, who knows, this year it might be Highland Games. A descendant of a Scottish peasant now sits in high office and, with the seals of office, is able to give us this £8,000 concession in a £5,000 million Budget. It is not very much. If there is an ounce of patriotism in his heart, as there must be, surely he will give this concession to Scotland who gave his ancestors to him and gave him to the British people, for their sorrows.
If I do not move the Government on grounds of national sentiment, if I do not move the Chancellor on grounds of personal sentiment, let me appeal to the Englishman's purse and say, "You can make a great deal of money by raising this tax from Highland Games". Making them free of tax by encouraging more games would attract more tourists to Scotland. That would add to our revenue and help our dollar position. There we have the motives, sentiment, national pride and money; surely I have satisfied hon. Members opposite in some way or other. I ask the Chancellor to be reasonable and to give Scotland the concession that she certainly wants.

Mr. H. Macmillan: The debate has now gone on for a very long time and ranged over rather a wide field. In the last lap or two it has taken some rather unexpected turns. It has been an agreeable and very interesting discussion in which a large number of hon. Members have given their views about different kinds of sports and I think that we can now feel that the subject has been fully discussed.
I intervene, therefore, only because I think it would be discourteous if I did not make a reply before suggesting that the Committee should now proceed to a decision. The views of the Government were stated—admirably stated as always, and very courteously stated—by the Financial Secretary to the Treasury. The conclusion which I draw from this debate, coming new to it, is the danger of discrimination,

because almost every hon. Member has wished to promote a particular fancy at the expense of that of someone else.
It is quite true that the whole story of this Entertainments Duty is a story of various discriminations. There was the one which my right hon. Friend and predecessor made in 1953, when he exempted cricket and made the distinction between amateur and professional. Both those were welcomed at the time, but both have led to a great deal of complaint that they were unfair or improper discriminations. In a very few months of holding this office I have learned how difficult it is to make a concession of any kind when, after the first reaction of pleasure from the persons receiving the concession, there are all the demands of other people to get something similar because they feel they have been badly treated.
This new Clause, so admirably moved by the hon. Member for Stoke-on-Trent, South (Mr. Ellis Smith), is itself discriminatory. I am bound to say that I had a good deal of sympathy with the speech of the hon. Member for West Ham, North (Mr. Lewis); he pointed out that this new Clause was grossly unfair to the interests which he frankly said he represented. I understood him to say that a football match could not be played on the ground at all unless the ground had been supported by the admirable efforts of the dog racers and others.

Mr. Ellis Smith: Manchester United are now the richest football club in the country and there is no dog racing anywhere near them. We do not mind discrimination of the kind in our new Clause, because it would exempt from tax the men and women who take part in these sports.

Mr. Lewis: Will the Chancellor bear in mind, in answering my hon. Friend, that Manchester United were anxious, as all football clubs are anxious, to get to Wembley for the Cup Final; and Wembley would not be there for the Cup Final were it not for the money received each week from greyhound racing?

Mr. Macmillan: That is the point I was trying to put as fairly as I could.
The general conclusion left upon my mind was that in the very difficult and complicated history of Entertainments Duty, of which this sports element is one


part, there has been this difficulty of making differences between one sport and another and one rate of tax and another. Even the new Clause is discriminatory; and while it goes back to the position maintained by the Leader of the Opposition in 1952, it goes against the position which he adopted at the General Election of 1955. All this is quite confusing.
I think I had better keep out of the controversy on boxing altogether. It introduced a new element of that happy reconciliation between Knutsford and Leicester which was, I am afraid, rudely interrupted by the quarrel between Warrington and Leicester.

Mr. Janner: Does the right hon. Gentleman agree with my right hon. Friend the Member for Warrington (Dr. Summerskill) that boxing should finish, or does he intend to do something to prevent that from happening?

Mr. Macmillan: I was pointing out how all the various views pressed upon me during the seven hours of the debate were very divergent in their results.
The hon. Member for Greenock (Dr. Mabon) made a speech which naturally appealed to me, but even he pointed out the tragic situation arising from another form of discrimination by which the Highland games are subject to tax and the Eisteddfod is not. The reason—and I am not saying that it is a good reason, but merely saying that it is the reason—is because it falls under this arrangement which was made in the past, one being amateur and one professional. It seems incredible, of course, that anybody should pay to attend an Eisteddfod, and certainly incredible that anybody should pay to take part in it. The Highland games are much more fun.

Dr. Mabon: I referred to the Eisteddfod and the Mods, which, after all, are festivals of Gaelic culture. These are nothing to do with the Highland games and only a small part is athletic. These are festivals of culture and nothing to do with athletic sports, and I believe they are exempt from Entertainments Duty if application is made to the Inland Revenue.

Mr. Macmillan: We have another Clause about that and we had better not anticipate it.
All these matters lead me to the general conclusion that the effort to work these different discriminatory methods has not been altogether satisfactory. I think the Committee has already reached the conclusion that the new Clause, and all the new Clauses separately, would merely add to the lack of logic in the present structure of the tax, if there is a lack of logic.
11.0 p.m.
In the Budget of this year, as I have had to say on other new Clauses, I determined to increase the estimated surplus by a considerable addition both to direct and to indirect taxation. I did that for reasons which I thought right, and which, I believe, broadly had the support of the House. The only remissions of taxation which I have been able to recommend to the Committee are in a single field—the field of savings. I have not, therefore, felt it possible to accept any of these new Clauses, although many of them have admirable purposes which carry a lot of sympathy.
When we come to consider the structure of the Entertainments Duty, in which £40 million is at stake, and the sports part of which accounts for £3½ million—we have already dealt with some of the cinema proposals; we are now dealing with the sports proposals, and we shall be dealing with others tomorrow—considering the many things which I have had to reject, I can only say that my advice is that this year we shall retain the principle upon which this Budget is based and the theme of which is that because of the broad, general economic situation, there must be an increase in the surplus, an increase in taxation direct and indirect, and remissions only for the single purpose of encouraging saving.
I hope, therefore, that the Committee will feel that while I recognise the very strong arguments which have been put forward, as they have been on other matters connected with the Entertainments Duty, it would not be right for me to do anything except advise the Committee to maintain it for the present year.

Question put, That the Clause be read a Second time:—

The Committee divided: Ayes 173, Noes 226.

Division No. 232.]
AYES
[6.12 p.m.


Ainsley, J. W.
Cronin, J. D.
Herbison, Miss M.


Albu, A. H.
Crossman, R. H. S.
Hewitson, Capt. M.


Allaun, Frank (Salford, E.)
Darling, George (Hillsborough)
Hobson, C. R.


Allen, Arthur (Bosworth)
de Freitas, Geoffrey
Holman, P.


Allen, Scholefield (Crewe)
Delargy, H. J.
Holmes, Horace


Anderson, Frank
Dodds, N. N.
Holt, A. F.


Awbery, S. S.
Donnelly, D. L.
Howell, Charles (Perry Barr)


Bacon, Miss Alice
Dugdale, Rt. Hn. John (W. Brmwoh)
Hubbard, T. F.


Bellenger, Rt. Hon. F. J.
Dye, S.
Hughes, Cledwyn (Anglesey)


Benson, G.
Ede, Rt. Hon. J. C.
Hughes, Emrys (S. Ayrshire)


Beswick, F.
Edelman, M.
Hunter, A. E.


Blackburn, F.
Edwards, Rt. Hon. John (Brighouse)
Irving, S. (Dartford)


Blenkinsop, A.
Edwards, Rt. Hon. Ness (Caerphilly)
Isaacs, Rt. Hon. G. A.


Blyton, W. R.
Edwards. Robert (Bilston)
Janner, B.


Boardman, H.
Evans, Albert (Islington, S.W.)
Jay, Rt. Hon. D. P. T.


Bottomley, Rt. Hon. A. G.
Evans, Edward (Lowestoft)
Jeger, Mrs. Lena (Holbn &amp; St. Pncs, S.)


Bowden, H. W. (Leicester, S.W.)
Fienburgh, W.
Johnson, James (Rugby)


Bowen, E. R. (Cardigan)
Finch, H. J.
Johnston, Douglas (Paisley)


Bowles, F. G.
Forman, J. C.
Jones, Rt. Hon. A. Creeoh (Wakefield)


Boyd, T. C.
Fraser, Thomas (Hamilon)
Jones, J. Idwal (Wrexham)


Braddock, Mrs. Elizabeth
Gaitskell, Rt. Hon. H. T. N.
Jones, T. W. (Merioneth)


Brockway, A. F.
Gibson, C. W.
Kenyon, C.


Broughton, Dr. A. D. D.
Gordon Walker, Rt. Hon. P. C.
Key, Rt. Hon. C. W.


Brown, Rt. Hon. George (Belper)
Greenwood, Anthony
King, Dr. H. M.


Brown, Thomas (Ince)
Grey, C. F.
Lawson, G. M.


Butler, Herbert (Hackney, C.)
Griffiths, David (Rother Valley)
Lever, Leslie (Ardwick)


Butler, Mrs. Joyce (Wood Green)
Griffiths, Rt. Hon. James (Llanelly)
Lewis, Arthur


Callaghan, L. J.
Griffiths, William (Exchange)
Lindgren, G. S.


Castle, Mrs. B. A.
Grimond, J.
Lipton, Lt.-Col. M.


Chapman, W. D.
Hale, Leslie
Logan, D. G.


Chetwynd, G. R.
Hamilton, W. W.
Mabon, Dr. J. Dickson


Clunie, J.
Hannan, W.
McGhee, H. G.


Coldrick, W.
Harrison, J. (Nottingham, N.)
Mclnnes, J.


Collick, P. H. (Birkenhead)
Hastings, S.
McKay, John (Wallsend)


Collins, V. J. (Shoreditch &amp; Finsbury)
Hayman, F. H.
McLeavy, Frank


Corbet, Mrs. Freda
Healey, Denis
Mahon, Simon


Cove, W. G.
Henderson, Rt. Hn. A. (Rwly Regis)
Mallalieu, J. P. W. (Huddersfd, E.)


Craddock, George (Bradford, S.)

Mann, Mrs. Jean




Marquand, R. Hon. H. A.
Pryde, D. J.
Taylor, John (West Lothian)


Mason, Roy
Randall, H. E.
Thomas, George (Cardiff)


Mayhew, C. P.
Rankin, John
Thomson, George (Dundee, E.)


Messer, Sir F.
Reeves, J.
Thornton, E.


Mitchison, G. R.
Reid, William
Tomney, F.


Monslow, W.
Robens, Rt. Hon. A.
Turner-Samuels, M.


Moody, A. S.
Roberts, Albert (Normanton)
Weitzman, D.


Morrison, Rt. Hn. Herbert (Lewis'm, S.)
Roberts, Goronwy (Caernarvon)
Wells, Percy (Faversham)


Moyle, A.
Robinson, Kenneth (St. Pancras, N.)
Wells, William (Walsall, N.)


Neal, Harold (Bolsover)
Rogers, George (Kensington, N.)
West, D. G.


Noel-Baker, Rt. Hon. P. (Derby, S.)
Ross, William
Wheeldon, W. E.


Oliver, G. H.
Royle, C.
White, Mrs. Eirene (E. Flint)


Oram, A. E.
Shurmer, P. L. E.
White, Henry (Derbyshire, N. E.)


Orbach, M.
Silverman, Julius (Aston)
Wilkins, W. A.


Oswald, T.
Simmons, C. J. (Brierley Hill)
Williams, Rev. Llywelyn (Ab'tillery)


Paling, Rt. Hon. W. (Dearne Valley)
Slater, Mrs. H. (Stoke, N.)
Williams, Rt. Hon. T. (Don Valley)


Paling, Will T. (Dewsbury)
Slater, J. (Sedgefield)
Williams, W. R. (Openshaw)


Palmer, A. M. F.
Smith, Ellis (Stoke, S.)
Williams, W. T. (Barons Court)


Parker, J.
Snow, J. W.
Willis, Eustace, (Edinburgh, E.)


Parkin, B. T.
Sorensen, R. W.
Wilson, Rt. Hon. Harold (Huyton)


Paton, John
Sparks, J. A.
Woodburn, Rt. Hon. A.


Pearson, A.
Stones, W. (Consett)
Woof, R. E.


Peart, T. F.
Strachey, Rt. Hon. J.
Yates, V. (Ladywood)


Price, J. T. (Westhoughton)
Stross, Dr. Barnett (Stoke-on-Trent, C.)
Younger, Rt. Hon. K.


Price, Philips (Gloucestershire, W.)
Summerskill, Rt. Hon. E.
Zilliacus, K.


Probert, A. R.
Sylvester, G. O.



Proctor, W. T.
Taylor, Bernard (Mansfield)
TELLERS FOR THE AYES:




Mr. Short and Mr. Deer.




NOES


Allan, R. A. (Paddington, S.)
Donaldson, Cmdr. C. E. MacA.
Hope, Lord John


Alport, C. J. M.
Doughty, C. J. A.
Hornby, R. P.


Amery, Julian (Preston, N.)
du Cann, E. D. L.
Hornsby-Smith, Miss M. P.


Amory, Rt. Hn. Heathcoat (Tiverton)
Dugdale, Rt. Hn. Sir T. (Richmond)
Horobin, Sir Ian


Arbuthnot, John
Duncan, Capt. J. A. L.
Howard, Hon. Greville (St. Ives)


Armstrong, C. W.
Duthie, W. S.
Howard, John (Test)


Ashton, H.
Eccles, Rt. Hon. Sir David
Hudson, Sir Austin (Lewisham, N.)


Atkins, H. E.
Eden, J. B. (Bournemouth, West)
Hughes Hallett, Vice-Admiral J.


Baldock, Lt.-Cmdr. J. M.
Elliot, Rt. Hon. W. E.
Hughes-Young, M. H. C.


Baldwin, A. E.
Emmet, Hon. Mrs. Evelyn
Hulbert, Sir Norman


Balniel, Lord
Errington, Sir Eric
Hutchison, Sir Ian Clark (E'b'gh, W.)


Banks, Col. C.
Erroll, F. J.
Hylton-Foster, Sir H. B. H.


Barter, John
Farey-Jones, F. W.
Iremonger, T. L.


Baxter, Sir Beverley
Fell, A.
Irvine, Bryant Godman (Rye)


Beamish, Maj. Tufton
Finlay, Graeme
Jenkins, Robert (Dulwich)


Bell, Philip (Bolton, E.)
Fleetwood-Hesketh, R. F.
Jennings, J. C. (Burton)


Bell, Ronald (Bucks, S.)
Fort, R.
Johnson, Dr. Donald (Carlisle)


Bevins, J. R. (Toxteth)
Freeth, D. K.
Johnson, Eric (Blackley)


Biggs-Davison, J. A.
Gammans, Sir David
Johnson, Howard (Kemptown)


Bishop, F. P.
Garner-Evans, E. H.
Jones, Rt. Hon. Aubrey (Hall Gr[...]en)


Black, C. W.
George, J. C. (Pollok)
Joseph, Sir Keith


Body, R. F.
Gibson-Watt, D.
Keegan, D.


Boothby, Sir Robert
Glover, D.
Kerby, Capt. H. B.


Bossom, Sir A. C.
Godber, J. B.
Kerr, H. W.


Boyd-Carpenter, Rt. Hon. J. A.
Gough, C. F. H.
Kershaw, J. A.


Boyle, Sir Edward
Gower, H. R.
Kimball, M


Braine, B. R.
Graham, Sir Fergus
Kirk, P. M.


Braithwaite, Sir Albert (Harrow, W.)
Grant, W. (Woodside)
Lagden, G. W.


Bromley-Davenport, Lt.-Col. W. H.
Grant-Ferris, Wg Cdr. R. (Nantwich)
Lambert, Hon. G.


Brooke, Rt. Hon. Henry
Green, A.
Lancaster, Col. C. G.


Brooman-White, R. C.
Gresham Cooke, R.
Langford-Holt, J. A.


Browne, J. Nixon (Craigton)
Grimston, Hon. John (St. Albans)
Leather, E. H. C.


Buchan-Hepburn, Rt. Hon. P. G. T.
Grimston, Sir Robert (Westbury)
Leavey, J. A.


Bullus, Wing Commander E. E.
Grosvenor, Lt.-Col. R. G.
Legge-Bourke, Maj. E. A. H.


Burden, F. F. A.
Gurden, Harold
Legh, Hon. Peter (Petersfield)


Butcher, Sir Herbert
Hall, John (Wycombe)
Lindsay, Hon. James (Devon, N.)


Butler, Rt. Hn. R. A. (Saffron Walden)
Hare, Rt. Hon. J. H.
Lindsay, Martin (Solihull)


Campbell, Sir David
Harris, Frederic (Croydon, N. W.)
Linstead, Sir H. N.


Cary, Sir Robert
Harris, Reader (Heston)
Lloyd, Maj. Sir Guy (Renfrew, E.)


Channon, H.
Harrison, A. B. C. (Maldon)
Low, Rt. Hon. A. R. W.


Cole, Norman
Harrison, Col. J. H. (Eye)
Lucas, Sir Jocelyn (Portsmouth, S.)


Conant, Maj. Sir Roger
Harvey, Air Cdre. A. V. (Macclesfd)
Lucas, P. B. (Brentford &amp; Chiswick)


Cooper-Key, E. M.
Harvey, Ian (Harrow, E.)
Lucas-Tooth, Sir Hugh


Cordeaux, Lt.-Col. J. K.
Harvey, John (Walthamstow, E.)
McAdden, S. J.


Corfield, Capt. F. V.
Harvie-Watt, Sir George
Macdonald, Sir Peter


Crouch, R. F.
Heald, Rt. Hon. Sir Lionel
McKibbin, A. J.


Crowder, Sir John (Finchley)
Heath, Rt. Hon. E. R. G.
Mackie, J. H. (Galloway)


Crowder, Petre (Ruislip—Northwood)
Henderson, John (Cathcart)
McLaughlin, Mrs. P.


Cunningham, Knox
Hill, Rt. Hon. Charles (Luton)
Maclay, Rt. Hon John


Currie, G. B. H.
Hill, Mrs. E. (Wythenshawe)
McLean, Neil (Inverness)


Dance, J. C. G.
Hinchingbrooke, Viscount
Macmillan, Rt. Hn. Harold (Bromley)


Davidson, Viscountess
Hirst, Geoffrey
Macpherson, Niall (Dumfries)


D'Avigdor-Goldsmid, Sir Henry
Holland-Martin, C. J.
Maddan, Martin


Deedes, W. F.

Maitland, Cdr. J. F. W. (Horncastle)







Maitland, Hon. Patrick (Lanark)
Powell, J. Enoch
Summers, Sir Spencer


Manningham-Buller, Rt. Hn. Sir R.
Prior-Palmer, Brig. O. L.
Taylor, Sir Charles (Eastbourne)


Marples, A. E.
Profumo, J. D.
Taylor, William (Bradford, N.)


Mathew, R.
Raikes, Sir Victor
Thomas, P. J. M. (Conway)


Maude, Angus
Ramsden, J. E.
Thompson, Kenneth (Walton)


Maudling, Rt. Hon. R.
Redmayne, M.
Thompson, Lt.-Cdr. R. (Croydon, S.)


Mawby, R. L.
Rees-Davies, W. R.
Thornton-Kemsley, C. N.


Maydon, Lt.-Comdr, S. L. C.
Remnant, Hon. P.
Touche, Sir Gordon


Medlicott, Sir Frank
Renton, D. L. M.
Turner, H. F. L.


Milligan, Rt. Hon. W. R.
Ridsdale, J. E.
Turton, Rt. Hon. R. H.


Moore, Sir Thomas
Rippon, A. G. F.
Vane, W. M. F.


Morrison, John (Salisbury)
Robertson, Sir David
Vaughan-Morgan, J. K.


Nabarro, G. D. N.
Robinson, Sir Roland (Blackpool, S.)
Vickers, Miss J. H.


Nairn, D. L. S.
Roper, Sir Harold
Walker-Smith, D. C.


Neave, Airey
Schofield, Lt.-Col. W.
Wall, Major Patrick


Nicholson, Godfrey (Farnham)
Scott-Miller, Cmdr. R.
Ward, Hon. George (Worcester)


Nicolson, N. (B'n'm'th, E. &amp; Chr'oh)
Sharples, R. C.
Ward, Dame Irene (Tynemouth)


Nield, Basil (Chester)
Shepherd, William
Waterhouse, Capt. Rt. Hon. C.


Nugent, G. R. H.
Simon, J. E. S. (Middlesbrough, W.)
Webbe, Sir H.


Oakshott, H. D.
Soames, Capt. C.
Whitelaw, W. S. I. (Penrith &amp; Border)


O'Neill, Hon. Phelim (Co. Antrim, N.)
Spearman, Sir Alexander
Williams, Paul (Sunderland, S.)


Ormsby-Gore, Hon. W. D.
Speir, R. M.
Williams, R. Dudley (Exeter)


Orr, Capt. L. P. S.
Spence, H. R. (Aberdeen, W.)
Wills, G. (Bridgwater)


Osborne, C.
Spens, Rt. Hn. Sir P. (Kens'g'tn, S.)
Wilson, Geoffrey (Truro)


Page, R. G.
Stanley, Capt. Hon. Richard
Wood, Hon. R.


Pannell, N. A. (Kirkdale)
Stevens, Geoffrey
Woollam, John Victor


Peyton, J. W. W.
Steward, Harold, (Stockport, S.)



Pilkington, Capt. R. A.
Steward, Sir William (Woolwich, W.)
TELLERS FOR THE NOES:


Pitt, Miss E. M.
Studholme, Sir Henry
Mr. Edward Wakefield and




Mr. Barber.

Division No. 233.]
AYES
[11.1 p.m.


Ainsley, J. W.
Hall, Rt. Hn. Glenvil (Colne Valley)
Oliver, G. H.


Albu, A. H.
Hamilton, W. W.
Oram, A. E.


Allaun, Frank (Salford, E.)
Hannan, W.
Orbach, M.


Allen, Arthur (Bosworth)
Harrison, J. (Nottingham, N.)
Oswald, T.


Allen Scholefield (Crewe)
Hayman, F. H.
Owen, W. J.


Awbery, S. S.
Healey, Denis
Paling, Rt. Hon. W. (Dearne Valley)


Bacon, Miss Alice
Henderson, Rt. Hn. A. (Rwly Regis)
Palmer, A. M. F.


Baird, J.
Herbison, Miss M.
Pargiter, G. A.


Benson, G.
Hewitson, Capt. M.
Parker, J.


Beswick, F.
Hobson, C. R.
Parkin, B. T.


Blackburn, F.
Holman, P.
Pearson, A.


Blenkinsop, A.
Howell, Charles (Perry Barr)
Peart, T. F.


Blyton, W. R.
Hubbard, T. F.
Price, J. T. (Westhoughton)


Boardman, H.
Hughes, Emrys (S. Ayrshire)
Price, Philips (Gloucestershire, W.)


Bottomley, Rt. Hon. A. G.
Hunter, A. E.
Probert, A. R.


Bowden, H. W. (Leicester, S.W.)
Irvine, A. J. (Edge Hill)
Pryde, D. J.


Boyd, T. C.
Irving, S. (Dartford)
Randall, H. E.


Braddock, Mrs. Elizabeth
Isaacs, Rt. Hon. G. A.
Redhead, E. C.


Brockway, A. F.
Janner, B.
Roberts, Albert (Normanton)


Broughton, Dr. A. D. D.
Jay, Rt. Hon. D. P. T.
Roberts, Goronwy (Caernarvon)


Brown, Thomas (Ince)
Jeger, George (Goole)
Robinson, Kenneth (St. Pancras, N.)


Burton, Miss F. E.
Jenkins, Roy (Stechford)
Rogers, George (Kensington, N.)


Butler, Herbert (Hackney, C.)
Johnson, James (Rugby)
Ross, William


Callaghan, L. J.
Johnston, Douglas (Paisley)
Short, E. W.


Castle, Mrs. B. A.
Jones, Rt. Hon. A. Creeoh (Wakefield)
Shurmer, P. L. E.


Chetwynd, G. R.
Jones, Elwyn (W. Ham, S.)
Simmons, C. J. (Brierley Hill)


Coldrick, W.
Jones, Jack (Rotherham)
Slater, Mrs. H. (Stoke, N.)


Collick, P. H. (Birkenhead)
Jones, J. Idwal (Wrexham)
Slater, J. (Sedgefield)


Corbet, Mrs. Freda
Jones, T. W. (Merioneth)
Smith, Ellis (Stoke, S.)


Craddock, George (Bradford, S.)
Kenyon, C.
Snow, J. W.


Cronin, J. D.
King, Dr. H. M.
Sorensen, R. W.


Davies, Ernest (Enfield, E.)
Lawson, G. M.
Sparks, J. A.


Deer, G.
Lever, Harold (Cheetham)
Stokes, Rt. Hon. R. R. (Ipswich)


de Freitas, Geoffrey
Lever, Leslie (Ardwick)
Stones, W. (Consett)


Delargy, H. J.
Lewis, Arthur
Strachey, Rt. Hon. J.


Dodds, N. N.
Logan, D. G.
Stross,Dr.Barnett(Stoke-on-Trent,C.)


Donnelly, D. L.
Mabon, Dr. J. Dickson
Summerskill, Rt. Hon. E.


Dugdale, Rt. Hn. John (W. Brmwch)
MacColl, J. E.
Sylvester, G. O.


Ede, Rt. Hon. J. C.
McGhee, H. G.
Taylor, Bernard (Mansfield)


Edelman, M.
McInnes, J.
Taylor, John (West Lothian)


Edwards, Robert (Bilston)
McKay, John (Wallsend)
Thomas, George (Cardiff, W.)


Evans, Albert (Islington, S.W.)
McLeavy, Frank
Thornton, E.


Evans, Edward (Lowestoft)
Mahon, Simon
Tomney, F.


Fernyhough, E.
Mallalieu, E. L. (Brigg)
Turner-Samuels, M.


Fienburgh, W.
Mallalieu, J. P. W. (Huddersfd, E.)
Ungoed-Thomas, Sir Lynn


Finch, H. J.
Mann, Mrs. Jean
Viant, S. P.


Fletcher, Eric
Mason, Roy
Warbey, W. N.


Forman, J. C.
Mayhew, C. P.
Weitzman, D.


Fraser, Thomas (Hamilton)
Mikardo, Ian
Wheeldon, W. E.


Gaitskell, Rt. Hon. H. T. N.
Mitchison, G. R.
White, Henry (Derbyshire, N.E.)


Gibson, C. W.
Monslow, W.
Williams, Rt. Hon. T. (Don Valley)


Gordon Walker, Rt. Hon. P. C.
Moody, A. S.
Williams, W. R. (Openshaw)


Greenwood, Anthony
Mort, D. L.
Wilson, Rt. Hon. Harold (Huyton)


Grey, C. F.
Moyle, A.
Woof, R. E.


Griffiths, David (Rother Valley)
Mulley, F. W.
Yates, V. (Ladywood)


Griffiths, Rt. Hon. James (Llanelly)
Neal, Harold (Bolsover)
Younger, Rt. Hon. K.


Griffiths, William (Exchange)
Noel-Baker, Rt. Hon. P. (Derby, S.)
Zilliacus, K.


Hale, Leslie
O'Brien, Sir Thomas
TELLERS FOR THE AYES:




Mr. Holmes and Mr. Wilkins.




NOES


Allan, R. A. (Paddington, S.)
Body, R. F.
Davidson, Viscountess


Alport, C. J. M.
Bossom, Sir A. C.
D'Avigdor-Goldsmid, Sir Henry


Amery, Julian (Preston, N.)
Bowen, E. R. (Cardigan)
Deedes, W. F.


Amory, Rt. Hn. Heathcoat (Tiverton)
Boyle, Sir Edward
Dodds-Parker, A. D.


Arbuthnot, John
Bromley-Davenport, Lt.-Col. W. H.
Donaldson, Cmdr. C. E. McA.


Armstrong, C. W.
Brooke, Rt. Hon. Henry
Doughty, C. J. A.


Ashton, H.
Buchan-Hepburn, Rt. Hon. P. G. T.
du Cann, E. D. L.


Atkins, H. E.
Bullus, Wing Commander E. E.
Dugdale, Rt. Hn. Sir T. (Richmond)


Baldock, Lt.-Cmdr. J. M.
Burden, F. F. A.
Duthie, W. S.


Balniel, Lord
Butcher, Sir Herbert
Elliot, Rt. Hon. W. E.


Barber, Anthony
Butler,Rt.Hn.R.A.(Saffron Walden)
Emmet, Hon. Mrs. Evelyn


Barter, John
Carr, Robert
Errington, Sir Eric


Baxter, Sir Beverley
Channon, H.
Farey-Jones, F. W.


Beamish, Maj. Tufton
Cole, Norman
Fell, A.


Bell, Philip (Bolton, E.)
Cooper-Key, E. M.
Finlay, Graeme


Bennett, Dr. Reginald
Cordeaux, Lt.-Col. J. K.
Fisher, Nigel


Bevins, J. R. (Toxteth)
Corfield, Capt. F. V.
Fleetwood-Hesketh, R. F.


Bidgood, J. C.
Crouch, R. F.
Fletcher-Cooke, C.


Biggs-Davison, J. A.
Cunningham, Knox
Fort, R.


Bishop, F. P.
Currie, G. B. H.
Foster, John


Black, C. W.
Dance, J. C. G.
Freeth, D. K.







Garner-Evans, E. H.
Kerr, H. W.
Powell, J. Enoch


George, J. C. (Pollok)
Kershaw, J. A.
Prior-Palmer, Brig, O. L.


Gibson-Watt, D.
Kimball, M.
Profumo, J. D.


Glover, D.
Kirk, P. M.
Raikes, Sir Victor


Gough, C. F. H.
Lagden, G. W.
Ramsden, J. E.


Gower, H. R.
Lambert, Hon. G.
Redmayne, M.


Graham, Sir Fergus
Lancaster, Col. C. G.
Rees-Davies, W. R.


Grant, W. (Woodside)
Langford-Holt, J. A.
Remnant, Hon. P.


Grant-Ferris, Wg Cdr. R. (Nantwich)
Leather, E. H. C.
Renton, D. L. M.


Green, A.
Leavey, J. A.
Ridsdale, J. E.


Gresham Cooke, R.
Legge-Bourke, Maj. E. A. H.
Rippon, A. G. F.


Grimond, J.
Lindsay, Hon. James (Devon, N.)
Roberts, Sir Peter (Heeley)


Grimston, Hon. John (St. Albans)
Lindsay, Martin (Solihull)
Robertson, Sir David


Grimston, Sir Robert (Westbury)
Linstead, Sir H. N.
Robinson, Sir Roland (Blackpool, S.)


Grosvenor, Lt.-Col. R. G.
Lloyd, Maj. Sir Guy (Renfrew, E.)
Roper, Sir Harold


Gurden, Harold
Longden, Gilbert
Schofield, Lt.-Col. W.


Hall, John (Wycombe)
Lucas, Sir Jocelyn (Portsmouth, S.)
Sharples, R. C.


Harris, Frederic (Croydon, N. W.)
Lucas, P. B. (Brentford &amp; Chiswick)
Shepherd, William


Harrison, A. B. C. (Maldon)
Lucas-Tooth, Sir Hugh
Simon, J. E. S. (Middlesbrough, W.)


Harrison, Col. J. H. (Eye)
McAdden, S. J.
Smithers, Peter (Winchester)


Harvey, Air Cdre. A. V. (Macclesfd)
Macdonald, Sir Peter
Spearman, Sir Alexander


Harvey, Ian (Harrow, E.)
McKibbon, A. J
Spence, H. R. (Aberdeen, W.)


Harvey, John (Walthamstow, E.)
Mackie, J. H. (Galloway)
Spens, Rt. Hn. Sir P. (Kens'gt'n, S.)


Head, Rt. Hon. A. H.
McLaughlin, Mrs. P.
Stanley, Capt. Hon. Richard


Heald, Rt. Hon. Sir Lionel
McLean, Neil (Inverness)
Stevens, Geoffrey


Heath, Rt. Hon. E. R. G.
Macmillan, Rt. Hn. Harold (Bromley)
Steward, Harold (Stockport, S.)


Henderson, John (Cathcart)
Maddan, Martin
Steward, Sir William (Woolwich, W.)


Hicks-Beach, Maj. W. W.
Maitland, Hon. Patrick (Lanark)
Studholme, Sir Henry


Hill, Rt. Hon. Charles (Luton)
Marlowe, A. A. H.
Summers, Sir Spencer


Hill, Mrs. E. (Wythenshawe)
Marples, A. E.
Taylor, Sir Charles (Eastbourne)


Hinchingbrooke, Viscount
Mathew, R.
Taylor, William (Bradford, N.)


Hirst, Geoffrey
Maude, Angus
Thomas, P. J. M. (Conway)


Holland-Martin, C. J.
Maudling, Rt. Hon. R.
Thompson, Kenneth (Walton)


Holt, A. F.
Mawby, R. L.
Thompson, Lt.-Cdr. R. (Croydon, S.)


Hope, Lord John
Maydon, Lt.-Cmdr. S. L. C.
Thornton-Kemsley, C. N.


Hornby, R. P.
Medlicott, Sir Frank
Turner, H. F. L.


Horobin, Sir Ian
Milligan, Rt. Hon. W. R.
Turton, Rt. Hon. R. H.


Horsbrugh, Rt. Hon. Dame Florence
Molson, Rt. Hon. Hugh
Vane, W. M. F.


Howard, Hon. Greville (St. Ives)
Moore, Sir Thomas
Vaughan-Morgan, J. K.


Howard, John (Test)
Morrison, John (Salisbury)
Vickers, Miss J. H.


Hudson, Sir Austin (Lewisham, N.)
Nabarro, G. D. N.
Vosper, D. F.


Hughes, Hallett, Vice-Admiral J.
Nairn, D. L. S.
Wade, D. W.


Hughes-Young, M. H. C.
Neave, Airey
Wakefield, Edward (Derbyshire, W.)


Hutchison, Sir Ian Clark(E'b'gh, W.)
Nicholson, Godfrey (Farnham)
Wall, Major Patrick


Hylton-Foster, Sir H. B. H.
Nicolson, N. (B'n'm'th, E. &amp; Chr'ch)
Ward, Hon. George (Worcester)


lremonger, T. L.
Nield, Basil (Chester)
Ward, Dame Irene (Tynemouth)


Irvine, Bryant Godman (Rye)
Nugent, G. R. H.
Waterhouse, Capt. Rt. Hon. C.


Jenkins, Robert (Dulwich)
Oakshott, H. D.
Whitelaw, W. S. I. (Penrith &amp; Border)


Jennings, J. C. (Burton)
O'Neill, Hn. Phelim (Co. Antrim, N.)
Williams, Paul (Sunderland, S.)


Johnson, Dr. Donald (Carlisle)
Ormsby-Gore, Hon. W. D.
Wiliams, R. Dudley (Exeter)


Johnson, Eric (Blackley)
Osborne, C.
Wills, G. (Bridgwater)


Jones, Rt. Hon. Aubrey (Hall Green)
Page, R. G.
Wilson, Geoffrey (Truro)


Joseph, Sir Keith
Pannell, N. A. (Kirkdale)
Woollam, John Victor


Kaberry, D.
Peyton, J. W. W.



Keegan, D.
Pitt, Miss E. M.
TELLERS FOR THE NOES:




Mr. Legh and Mr. Godber.

The Temporary Chairman: Is it proposed to move the new Clause, "Exemption of Highland games from entertainments duty"?

Mr. H. Wilson: In view of the lateness of the hour, and the fact that the Clause has been fully covered in speeches and in the Vote we have just given, we do not propose to move it.

New Clause.—(ALLOWANCES IN RESPECT OF CAPITAL EXPENDITURE ON SOURCES OF MINERAL DEPOSITS.)

(1) Subject to the provisions of this section, capital expenditure incurred by any person after the fifth day of April, nineteen hundred and fifty-six, in connection with the working of a mine, oil well or other source of mineral deposits of a wasting nature, being expenditure on the acquisition of land which is to be used in connection with the working of the source, shall, notwithstanding anything in section three hundred and five of the Income Tax Act, 1952, be expenditure to which Chapter III of Part X of that Act applies, and Part X of that Act shall have effect accordingly.

(2) Section three hundred and six of the Income Tax Act, 1952, shall not apply to expenditure to which this section applies.

(3) Section three hundred and ten of the Income Tax Act, 1952, and section twenty-one of and the Fifth Schedule to the Finance Act, 1952, shall not apply to expenditure to which this section applies.

(4) This section shall not apply—

(a) to expenditure which, apart from the provisions of this section of section three hundred and ten of the Income Tax Act, 1952, and of section twenty-one of the Finance Act, 1952, is expenditure to which Chapter III of the Income Tax Act, 1952, applies; or
(b) to expenditure on machinery or plant, or on any asset which has been treated for any year of assessment as machinery or plant; or
(c) to expenditure on the acquisition of a building or structure for use in connection with the working of a source of mineral deposits, in so far as the expenditure is attributable to the building or structure and not to its site, if—

(i) the building or structure when so used is an industrial building or structure

within the meaning of Chapter I of Part X of the Income Tax Act, 1952; and
(ii) the interest acquired is the relevant interest within the meaning of that Chapter in relation to the capital expenditure incurred on the construction of that building or structure.

(5) In no case shall the amount on which a balancing charge is made upon a person be increased by virtue of the provisions of this section by more than the total amount by which annual allowances made to that person are increased by virtue thereof.

(6) The Income Tax Act, 1952, shall have effect, and this section shall be construed, as if this section were contained in Chapter III of Part X of that Act.—[Mr. Braine.]

Brought up, and read the First time.

Mr. Bernard Braine: I beg to move, That the Clause be read a Second time.
The object of this new Clause is to give effect to the recommendations of the Royal Commission on the Taxation of Profits and Income that a depletion allowance should be made in future in respect of the cost of acquisition of mineral rights and lands. The Committee will be aware that a mining concern is allowed to deduct all expenditure of a revenue character incurred in the course of extracting minerals. There are special provisions for the amortisation of capital expenditure on finding and developing mineral sources and on plant, machinery and buildings acquired or built and necessary for such development.
An allowance is also given in respect of mineral-bearing land purchased overseas, although the concession is limited to


the first United Kingdom purchaser, but no allowance whatever is given for amortisation of capital spent on purchase of mineral-bearing land in this country.
It is not surprising that the Royal Commission, having heard a great deal of evidence and having given careful consideration to the matter, should find that the present practice is one which does not take the true profits into account as the basis of taxation, and that it came to the conclusion that a change was necessary. It has long been the argument of those engaged in the mining and extractive industries of this country that the current tax practice is unfair, illogical and contrary to the national interest.
It is unfair because the inevitable reduction in the value of the land acquired for mining operations is just as much a cost of production as the raw materials used in any ordinary manufacturing process. Yet this cost is not recognised by the Inland Revenue when the producer's profits are assessed for tax purposes. It is true that in some cases there is a residual value in the land when all the minerals have been extracted. In others, there is little or no residual value.
I have a constituent who has been in business as a sand and gravel merchant over a long period of years. On the working out of a deposit he has to go further afield and acquire more land. Most of his land is what is known technically as "wet land". Material has to be extracted from wet pits. Water is always present. Therefore, when the extraction is completed it is extremely difficult to resell the land for any profitable purpose. It is true that trees are planted and the scars are hidden, but in terms of money the residual value of the land is nil and buyers are unlikely to be attracted. In any event, this new Clause would take into account any residual value that remained by means of a balancing charge when all the minerals have been extracted.
I said that the present tax practice was unfair, and it is particularly unfair in relation to the ballast and sand industry for three main reasons. First, in relation to the value of the minerals extracted, the land is more costly than in almost any other extractive industry. The seams are shallow. The whole of the surface of the land acquired is dis-

turbed because there is no question of driving a shaft. The exhaustion of the more accessible and easily worked seams means that the cost of land in relation to the value of output is rising steadily.
The second reason why the present practice is unfair is that since sand and gravel are among the cheapest minerals produced in this country, the cost of the land from which they are obtained represents a greater proportion of the cost of the final, marketed product than in many other mineral industries.
Thirdly, the cost of the production includes not only the purchase of the land, the extraction, processing and sale of the minerals and the administration of the business, but must also include the final restoration of the land. Admittedly, such costs are allowed as a normal deductible expense for tax purposes, but if, as often happens, these costs fall in the last year of working a deposit, it may be that profits are insufficient to offset the allowances and a taxpayer is unable to obtain the full relief due to him.
I said that the present tax practice was illogical. In my view, it is so for two reasons. First, if a mineral area in this country is worked on a royalty basis, so that the right of working is acquired by annual payments, the royalties are recognised as a charge against taxable profits. If, on the other hand, the same area is acquired outright, and exactly the same processes take place and the same quantities of minerals are extracted, the whole of the profits are brought into account for the purposes of computing the tax, without any allowance for the acquisition of the land which, after all, is the operator's stock.
The second reason why the practice is illogical is the distinction made between operators in this country and overseas. It may be within the recollection of some hon. Members that in 1920 the Royal Commission on Income Tax, which sat under the distinguished chairmanship of Lord Colwyn, went into this question. That Commission was not in favour of granting a depletion allowance to companies operating in this country. It laid down that
the allowance must not be granted in respect of a right to any income derived from any asset.


That was fair enough, but the Commission went on to recommend that where a foreign mining venture was acquired by a United Kingdom operator an amortisation allowance should be granted to the first United Kingdom purchaser.
6.30 p.m.
I will not bother the Committee with the arguments which led to this differentiation being made because the majority Report of the Royal Commission, which reported last year, dismissed those reasons as fallacious. In any event, the Colwyn Commission's recommendation that a depletion allowance should be allowed for companies operating overseas was not put into effect until, nearly 30 years later, the Finance Act, 1949. Even then the concession, for reasons which I have been unable to discover, was not extended to companies operating here.
I am sure that the Committee will see, as did the Tucker Committee and the Royal Commission, which reported last year, the unfairness and the illogicality of this discrimination. Whether a company is operating in this country extracting minerals, or overseas, the land it acquires in the first instance is clearly a wasting asset. The Royal Commission came to the very proper conclusion that there was no case for such discrimination.
I said that there was a third reason why a change should be made. It is a weighty reason; for in my view the present practice runs contrary to the national interest. It does so because the disallowance of the cost of the land exercises an inflationary influence upon prices. Let me illustrate that point. I will take the sand and ballast industry as an illustration because it is one that I know better than any other extraction industry and because it is more seriously affected by the present practice.
The sand and ballast industry has an output second only to that of the coal industries in the United Kingdom. With cement, it provides the raw material for our housing programme, our industrial expansion, our roads and defence works. The price of its product is bound to exercise a powerful influence upon the whole national economy. The Treasury knows full well that the greater portion of the nation's capital investment programme consists of construction. Break down any capital investment programme and we find that construction is the major factor.

Thus, there is the closest possible connection between investment generally in this country and the extractive industries, particularly cement, gravel and sand.
The Committee may be interested to know that in 1938 the sand and gravel industry produced about 28·7 million tons of material. In 1953, its output was 50 million tons, and in 1955, 60 million tons. There is the closest connection between those figures and the growth of our capital investment programme. An oil refinery consumes half a million tons of sand and gravel and a power station anything between 100,000 and 150,000 tons. London Airport consumed enough sand and gravel, so I am told, to build a dual carriageway from London to Birmingham.
Even the ordinary house and its surroundings consumed about 55 tons. I may have gone a little bit wide of the mark, but here is good reason for bringing home to the Committee the simple fact that there is the closest possible connection between the value secured for the outlay on capital investment and the price of basic building materials.
Consider the question of price. The sand and gravel deposits near the great centres of population are being steadily worked out and operators are being forced to go further afield. This is already having a very serious effect upon the costs of the industry. I went into this matter in some detail and I was astonished to find that it is uneconomic to haul sand and gravel much more than 25 miles from the pit. A haul over 13 miles will double the cost of the material to the consumer. The price of mineral-bearing land is rising, for two reasons. One reason is that landowners are charging more for it.

Mr. Collick: Hear, hear.

Mr. Braine: Of course, that fact may well be used as an argument against making a depletion allowance, but, since a powerful case can be made out for the allowance, I do not think that administrative difficulty in collecting tax from others should be allowed to obstruct it.
The second reason is that mineral deposits are becoming more difficult to work and are more unrewarding. From this fact one unfortunate consequence flows; ever greater provision has to be made in profit margins for reserves for the replacement of the land.
Let me make it plain to the Committee that the Clause does not go beyond what the Royal Commission recommended. It provides that a depletion allowance should be given in respect of land acquired for mineral working and that it should apply only to transactions taking place after 5th April this year. It provides that the depletion allowance should apply to all companies operating mineral workings either in this country or overseas and, very properly, that the basis of the relief should be actual monetary cost of the land less its residual value when all the minerals have been extracted.
I believe that justice, common sense and the broad national interest all combine in this instance to argue the case for something being done along the line suggested in the proposed new Clause. It is in that spirit that I commend the Clause to the Committee.

Dr. King: I have been asked by a number of firms in my constituency which are engaged in extracting minerals to support the Clause. I have also been asked by a number of firms in the adjacent constituency of Eastleigh to do the same. Unfortunately, the hon. Member for Eastleigh (Mr. D. Price) is unable to come to the Committee. Had he come, I am certain that he would have added his representations to those which have been made so ably by the hon. Member for Essex, South-East (Mr. Braine).
The claim of the extractive mineral workers is equitable. Because of that, I am pleased to join with the hon. Gentleman in asking the Minister to give very sympathetic consideration to this Clause. Most firms are allowed to charge the cost of their raw materials before estimating the profits on which tax is paid. The annual wear and tear in most industries is far less than the annual seeping away of resources that takes place in an industry of this kind.
Firms which the Clause tries to help are steadily using up their capital asset, the mineral that is being worked. The profit to be taxed ought certainly to take into account the yearly loss of the capital asset. If such a firm bought its minerals year by year from somebody else, it would be entitled to set the cost of the minerals which it had to buy

against its income before arriving at the profit on which Income Tax is levied. At the end of a number of years, such a firm is left with a worked-out piece of land.
Everybody would agree—these firms agree—that the value of the land at the end should not be counted as something to offset against the profits that have been made, as distinct from the minerals taken out. They can sell the worked-out land, but they claim that they ought to be able to offset against the cash they take from their businesses each year something to allow in time for a complete working out of the minerals in the land. If he took away the net cost of the land from what was paid for the land plus the minerals and divided that over the estimated number of years the land may be worked and allowed them to charge that annual sum as part of their annual expenses, I believe the Chancellor would be dealing with them fairly.
Two eminent Committees have recommended that. The Tucker Committee on the Taxation of Trading Profits in 1951 said:
the operating company's profits are not properly computed unless it receives an allowance based on the full amount it has expended on the acquisition of the minerals.
The Royal Commission in 1955 recommended:
in future a depletion allowance should be given in respect of the cost of acquisition of mineral rights or areas.
It went on to say:
The basis of relief should be the actual monetary cost less any residual value of the land at the close of working.
As the hon. Member pointed out, the principle which we seek to establish for extractive industries in our country was conceded in 1952 by the Government for extractive industries overseas, and on that the Royal Commission three years later said:
There is no material distinction between United Kingdom minerals and overseas minerals when the question at issue is the true computation of profit.
Expert opinion and the wisdom of the Royal Commission of Taxation of Profits and Income, to which all of us pay such high tribute, came down on the side of the extractive industries in their claim that the Chancellor should accept such a proposal as this new Clause embodies.

Mr. Ellis Smith: Was it unanimous?

Dr. King: Yes, I think so. I would remind the Committee that when the matter was debated in this House three years ago on 18th June, 1952, my hon. Friend the Member for Islington, East (Mr. E. Fletcher) said, in what seemed to me an admirable speech:
It seems to us quite immaterial whether the commodity is a metal or non-metal …
We were debating tax concessions for metals. My hon. Friend added:
The essential factor is that it comes out of the earth and there is a limited quantity in the earth, and therefore there should be some allowance for capital depreciation."—[OFFICIAL REPORT, 18th June, 1952; Vol. 502, c. 1420.]
I believe that the hon. Member for Essex, South-East has done a service to equity by introducing this new Clause, and I hope the Chancellor will give it very sympathetic consideration.

Mr. Edward du Cann: I rise to support the new Clause which has been so ably moved by my hon. Friend the Member for Essex, South-East (Mr. Braine) and so well supported by the hon. Member for Southampton, Itchen (Dr. King).
Enough has been said about the objects of the Clause, and the basis of reasoning which lies behind the suggestion that it should be incorporated in the Finance Bill, to make the point abundantly clear. Therefore, I shall speak very briefly and emphasise only what has been said in part already, that the Clause is very much in line, not only with the former Finance Act which dealt with Income Tax allowances for overseas workings, but also with the recommendations of the Tucker Committee and the Royal Commission on the Taxation of Profits and Income.
It is a fair point to make, also, that the Clause is very much in line with two Clauses in this Finance Bill, Clauses 13 and 14, which deal with capital allowances for industrial buildings and for expenditure on dredging. Indeed, I think that I could put the matter as high as to say that probably the lack of taxation relief by way of depletion allowance for the extractive industries is out of line with current legislation.
6.45 p.m.
My hon. Friend the Member for Essex, South-East has spoken about hardship and I shall not say more about that, but

there is a further point which has not been mentioned and which deserves some study when dealing with this Clause. The Clause as drafted deals only with matters of future acquisitions. It does not deal with the working of any land which is currently in hand. I appreciate that the prudent operator may well have purchased land with an eye to the future.
Although to do something for that class of operator in the extractive industry would perhaps go beyond the exact recommendations of the Royal Commission—and this Clause precisely follows what the Royal Commission recommended—I think the point should be brought out when discussing this matter that in equity it is probably right that we should go a little further than the Royal Commission recommended. If we look at the Report of the Royal Commission we find, in paragraph 444, some justification for so doing.
One ought also to point out that depletion allowances of one kind and another are granted in most other countries, but not in the United Kingdom. It is an anachronism that we do not have those allowances here. It is very much to be hoped that my right hon. Friend will see fit to look at the matter again. Many hon. Members on both sides of the Committee hope it might be possible for him to come to a favourable conclusion on the suggestion which has been made.

Mr. Norman Dodds: After the admirable way in which the case has been put by two hon: Members opposite and by my hon. Friend the Member for Southampton, Itchen (Dr. King), I am convinced that at this stage my greatest contribution in any effort I can make to persuade the Treasury to be sympathetic towards this new Clause is to be very brief. The case as put by interests in my constituency and throughout the district of north-west Kent is such that I think the interests behind the Clause are exceedingly reasonable in accepting its wording. There is no doubt that the date of 5th April, 1956, is by no means unanimously acceptable throughout the mineral interests; in fact, some are definitely of opinion that to be fair it would be wrong to put in that date; but those who have a claim for very much more than this are wise, in view of all the problems which are before the Treasury, to stand on very firm ground by


following the recommendations of the Tucker Committee in 1951 and the Royal Commission in 1955.
I should like the Treasury to bear in mind the words of the hon. Member for Taunton (Mr. du Cann) when he said that there is an excellent case for holdings which are already there to be looked at through the actions of wise men of the industry. Nevertheless, the Clause asks for no more than that sympathetic treatment should be accorded to a proposal on lines laid down by the Royal Commission and the Tucker Committee. I can but hope that the representatives of the Treasury with all their problems and difficulties, in view of the support which the Clause has received from both sides of the Committee, will be able to say tonight that they accept it. If not, I hope they will say with some deep conviction that the matter will be looked at before the next Finance Bill comes before us.

Mr. Douglas Marshall: I wish to support my hon. Friend the Member for Taunton (Mr. du Cann) in the points he made. My hon. Friend the Member for Essex, South-East (Mr. Braine), who moved the Clause, will, I feel sure, agree that he made the case for the cement and sand industries, but that so far not a word has been mentioned with regard to the china clay industry.
As most hon. Members are aware, the china clay industry at the present moment has the largest basic raw material exports from this country, and the whole of that industry is affected in a different way from the industries already mentioned. The industry needs very heavy capital equipment, and, from the size of that heavy capital equipment, before it is made ready, it is necessary to have substantial future reserves in hand in order, ultimately, to supply the necessary materials for the capital equipment provided.
Consequently, the entire industry is based in such a way that the inclusion of this Clause on the Royal Commission's recommendation would not, in fact, help the china clay industry at all. Therefore, I would suggest to the Minister that he should bear that fact very much in mind, and I hope that, in replying, he will at any rate agree with the principle that has been discussed, and should he suggest

that, at some future date, he will look into this matter. I hope he will also see how this Clause would apply to the china clay industry, and realise that, in fact, it would not help that industry unless we removed from it the following words in the second line:
the fifth day of April, nineteen hundred and fifty-six".
In those circumstances, I would fully support the Clause subject to that alteration.

Mr. F. H. Hayman: There is one point which has not yet been explained by those who support the Clause, and that is when the depletion allowance is to be given. I gathered from what the hon. Member for Bodmin (Mr. D. Marshall) has just said that it would begin at once, but what then happens to the person who, or concern which, buys up the whole of the reserves of a particular mineral in order to keep other people from exploiting them? It seems to me that very careful note ought to be taken of that point.
Again, the hon. Member for Essex, South-East (Mr. Braine) referred to landowners forcing up prices because there is a great demand for certain minerals. That may be the trend of a free economic market, but I suggest that, if we are to give tax relief in order to give greater prices to landowners, we ought to think again. I should like someone, on behalf of the mover of the Clause, to say something on that subject.

The Economic Secretary to the Treasury (Sir Edward Boyle): This is a Clause of considerable interest, and I am sure the Committee was obliged to my hon. Friend the Member for Essex, South-East (Mr. Braine) for the extremely able way in which he moved it. It was ably supported by a number of very interesting speeches from both sides of the Committee, and I could not help being reminded during my hon. Friend's speech of the times when a former Parliamentarian of distinction, the late Sir Herbert Williams, used to address us on sand and ballast from exactly the same seat.
I would say straight away that the Royal Commission's recommendations on allowances for mineral rights and areas and for land and buildings used in connection with mines are still being considered by my right hon. Friend, and the


Chancellor fully appreciates that this is a point of very considerable importance. If I cannot give my hon. Friends the answer they would like today, it is not because my right hon. Friend is not aware of what is at stake here. This subject of depletion allowances has frequently been discussed in this Committee. It is an important one, but I think it would be unwise for the Committee to hurry into deciding on what would be the best way of giving effect to the recommendations of the Royal Commission.
I think perhaps the Committee might like to be reminded of what the Royal Commission in fact recommended in its final Report in paragraphs 445 to 447. There were really two important points, or rather one important point and one subsidiary one. The important point in the Royal Commission's recommendation concerned the allowances for the acquisition of mineral rights, and these allowances, the Commission considered, ought to be widened as regards future acquisitions to include United Kingdom minerals.
They said that the allowance should be given by reference to the full cost of the mineral rights or areas, less any residual value at the close of working. That was the important recommendation, and the second and subsidiary one was for changes of a relatively minor character in the allowances made for land and buildings.
On the first recommendation, the case for an allowance for the expenditure on the acquisition of mineral rights and areas is that this expenditure is used up in producing the profits which are charged to tax, and that point was clearly brought out by my hon. Friends; that is to say, if no allowance is made, the concern is really paying tax on an unreal profit exceeding the true commercial profit. That is perfectly true, but the difficulty here is this. The question of an allowance to the purchaser of minerals at once raises the question whether we should levy a corresponding charge on the seller of the mineral rights, and there are a number of arguments here, with which I do not think I need trouble the Committee, which might lead us to give serious consideration to whether such a charge should be made.
I can tell the Committee that any legislation that would be required to give

effect to the Royal Commission's recommendations would inevitably be long and complicated, and I am not in a position to announce any such legislation today. As a matter of fact, my hon. Friend's new Clause goes beyond the Royal Commission's proposal in quite a number of respects, with which I do not think I need trouble the Committee. I thought I should put the position before the Committee, explain what the Royal Commission recommended, and give the Committee an undertaking that we are considering the whole situation very carefully in the light of the Commission's recommendations and taking into account all the difficulties that arise.

Mr. Mitchison: For once, I am very glad that the Economic Secretary has been cautious. If he had been more rash, I should have felt it our duty to warn him, but I do not think there is any need.
I think that my hon. Friend the Member for Falmouth and Camborne (Mr. Hayman) hit one nail on the head, and it was a nail which escaped the attention neither of the majority of the Royal Commission nor of the minority. It is only too easy with a Clause in this form for the landowner to form a company.
Let us take the case which the Commission itself took—the sale at a very high price to the company by the owner who pockets his capital gains and leaves the company to recoup itself to some considerable extent at the expense of the Exchequer. For that reason, both the majority and the minority of the Royal Commission insisted on safeguards in the Clause, and what is suggested by the majority was that the Revenue should be able to turn from the actual price paid in proper cases to the true market value of what was bought. The Clause contains no such safeguard, and, for that reason alone, I suggest, it would be a very dangerous one, and I was glad to hear the Economic Secretary agree, not necessarily on that point, but in general.
But there is a second point. The minority Report, which differed in many respects on this group of matters, did, I agree, presuppose to some extent a capital gains tax as part of this machinery, and I listened with interest to the point which the Economic Secretary made that in cases of this sort,


the true system of taxation for the purchaser of mineral rights is very closely tied up with the treatment of the profits of the sale in the hands of the vendor.
7.0 p.m.
I trust that when the Economic Secretary and his right hon. Friend are considering this matter they will not be so deluded by any doctrinaire objection to a capital gains tax as to shut that excellent conception out of their minds, for that was what the minority of the Royal Commission recommended in this respect. It is perfectly true to say that there is a sound general case for something of this sort being done. I am not speaking at the moment of the machinery or the form of taxation, but merely saying that there is some credence in the matter.
Nevertheless, the Economic Secretary will bear me out that there are close parallels with which the majority of the Royal Commission found itself unable to deal. If I may give one instance, the purchase of a lease at a premium was a matter with which the majority of the Royal Commission was unwilling to interfere, and successive Governments have long refused to allow any Income Tax concession on that premium. They have founded themselves on the distinction between Schedule A taxation and Schedule D taxation. That is taking us into the darker fields of Income Tax, and we need say no more than to point out that the anomaly exists.
Yet again, the concession which is made to foreign mines at present does not extend to every transaction. It simply extends to the first instance of a British purchase from a foreign vendor. That in itself, therefore, is not too logical. I will only say that I am glad that caution has been exercised.
There is one other matter I should like to point out to the Economic Secretary. If in any form whatever a concession of this sort is made to the owners and workers of mineral deposits, there is one very obvious owner and worker of mineral deposit who ought to have corresponding benefits. Goodness knows, the National Coal Board at present is being made to carry many strange imports, and a little relief in this respect would do no harm. When, with a liberal or, shall we say, a Conservative hand, the hon.

Gentleman dispenses—if ever he does—any concessions by way of taxation or otherwise to other mineral workers, I hope that the Exchequer will by that time have reached a sufficiently sound condition to be able to afford a similar concession to the National Coal Board, even if that means that some right hon. and hon. Gentlemen opposite will have to alter their views a little about what pays and what does not pay in the matter of nationalised industries.

Mr. Braine: I should not be human if I did not say that I am disappointed that nothing can be done, nor should I be realistic if I did not admit the weight of my hon. Friend's arguments. I am seized of the great difficulties. All I would say is that the Royal Commission recognised those difficulties and, nevertheless, came down on the side of action being taken.
However, since we have been promised that the whole question will be looked into very thoroughly, I beg to ask leave to withdraw the Motion.

Lieut.-Colonel Bromley-Davenport: Charmingly done.

Motion and Clause, by leave, withdrawn.

New Clause.—(EXEMPTION OF ASSOCIATION FOOTBALL MATCHES FROM ENTERTAINMENTS DUTY.)

(1) Football matches shall be excluded from the entertainments in respect of which enter-

tainments duty is payable and references in the enactment relating to that duty to an entertainment shall be construed accordingly.

(2) This section shall apply to all matches played after the first day of August, nineteen hundred and fifty-six.

(3) For the purpose of this section "football matches" shall include all matches played under the rules of the Football Association.—[Mr. Dugdale.]

Brought up, and read the First time.

Motion made, and Question put, That the Clause be read a Second time:—

The Committee divided: Ayes 170, Noes 224.

Division No. 234.]
AYES
[11.12 p.m.


Ainsley, J. W.
Hall, Rt. Hn. Glenvil (Colne Valley)
Oram, A. E.


Albu, A. H.
Hannan, W.
Orbach, M.


Allaun, Frank (Salford, E.)
Harrison, J. (Nottingham, N.)
Oswald, T.


Allen, Arthur (Bosworth)
Hayman, F. H.
Paling, Rt. Hon. W. (Dearne Valley)


Allen, Scholefield (Crewe)
Healey, Denis
Palmer, A. M. F.


Awbery, S. S.
Henderson, Rt. Hn. A. (Rwly Regis)
Pargiter, G. A.


Bacon, Miss Alice
Herbison, Miss M.
Parker, J.


Baird, J.
Hewitson, Capt. M.
Parkin, B. T.


Benson, G.
Hobson, C. R.
Pearson, A.


Beswick, F.
Holman, P.
Peart, T. F.


Blackburn, F.
Howell, Charles (Perry Barr)
Price, J. T. (Westhoughton)


Blenkinsop, A.
Hubbard, T. F.
Price, Philips (Gloucestershire, W.)


Blyton, W. R.
Hughes, Emrys (S. Ayrshire)
Probert, A. R.


Boardman, H.
Hunter, A. E.
Pryde, D. J.


Bottomley, Rt. Hon. A. G.
Irvine, A. J. (Edge Hill)
Randall, H. E.


Bowden, H. W. (Leicester, S. W.)
Irving, S. (Dartford)
Redhead, E. C.


Boyd, T. C.
Isaacs, Rt. Hon. G. A.
Roberts, Albert (Normanton)


Braddock, Mrs. Elizabeth
Janner, B.
Roberts, Goronwy (Caernarvon)


Brockway, A. F.
Jay, Rt. Hon. D. P. T.
Robinson, Kenneth (St. Pancras, N.)


Broughton, Dr. A. D. D.
Jeger, George (Goole)
Rogers, George (Kensington, N.)


Brown, Thomas (Ince)
Jenkins, Roy (Stechford)
Ross, William


Burton, Miss F. E.
Johnson, James (Rugby)
Short, E. W.


Butler, Herbert (Hackney, C.)
Johnston, Douglas (Paisley)
Shurmer, P. L. E.


Callaghan, L. J.
Jones, Rt. Hon. A. Creeoh (Wakefield)
Simmons, C. J. (Brierley Hill)


Castle, Mrs. B. A.
Jones, Elwyn (W. Ham, S.)
Slater, Mrs. H. (Stoke, N.)


Chetwynd, G. R.
Jones, Jack (Rotherham)
Slater, J. (Sedgefield)


Coldrick, W.
Jones, J. Idwal (Wrexham)
Smith, Ellis (Stoke, S.)


Collick, P. H. (Birkenhead)
Jones, T. W. (Merioneth)
Snow, J. W.


Corbet, Mrs. Freda
Kenyon, C.
Sorensen, R. W.


Craddock, George (Bradford, S.)
King, Dr. H. M.
Sparks, J. A.


Cronin, J. D.
Lawson, G. M.
Stokes, Rt. Hon. R. R. (Ipswich)


Davies, Ernest (Enfield, E.)
Lever, Harold (Cheetham)
Stones, W. (Consett)


Deer, G.
Lever, Leslie (Ardwick)
Strachey, Rt. Hon. J.


de Freitas, Geoffrey
Lewis, Arthur
Stross, Dr. Barnett (Stoke-on-Trent, C.)


Delargy, H. J.
Logan, D. G.
Summerskill, Rt. Hon. E.


Dodds, N. N.
Mabon, Dr. J. Dickson
Sylvester, G. O.


Donnelly, D. L.
MacColl, J. E.
Taylor, Bernard (Mansfield)


Dugdale, Rt. Hn. John (W. Brmwch)
McGhee, H. G.
Taylor, John (West Lothian)


Ede, Rt. Hon. J. C.
McInnes, J.
Thomas, George (Cardiff)


Edelman, M.
McKay, John (Wallsend)
Thornton, E.


Edwards, Robert (Bilston)
Mahon, Simon
Tomney, F.


Evans, Albert (Islington, S.W.)
Mallalieu, E. L. (Brigg)
Turner-Samuels, M.


Evans, Edward (Lowestoft)
Mallalieu, J. P. W. (Huddersfd, E.)
Ungoed-Thomas, Sir Lynn


Fernyhough, E.
Mann, Mrs. Jean
Viant, S. P.


Fienburgh, W.
Mason, Roy
Warbey, W. N.


Finch, H. J.
Mayhew, C. P.
Weitzman, D.


Fletcher, Eric
Mikardo, Ian
Wheeldon, W. E.


Forman, J. C.
Mitchison, G. R.
White, Henry (Derbyshire, N. E.)


Fraser, Thomas (Hamilton)
Monslow, W.
Williams, Rt. Hon. T. (Don Valley)


Gaitskell, Rt. Hon. H. T. N.
Moody, A. S.
Williams, W. R. (Openshaw)


Gibson, C. W.
Mort, D. L.
Wilson, Rt. Hon. Harold (Huyton)


Gordon-Walker, Rt. Ron. P. C.
Moyle, A.
Woof, R. E.


Greenwood, Anthony
Mulley, F. W.
Yates, V. (Ladywood)


Grey, C. F.
Neal, Harold (Bolsover)
Younger, Rt. Hon. K.


Griffiths, David (Rother Valley)
Noel-Baker, Rt. Hon. P. (Derby, S.)
Zilliacus, K.


Griffiths, Rt. Hon. James (Llanelly)
O'Brien, Sir Thomas
TELLERS FOR THE AYES:


Griffiths, William (Exchange)
Oliver, G. H.
Mr. Holmes and Mr. Wilkins


Hale, Leslie






NOES


Allan, R. A. (Paddington, S.)
Bossom, Sir A. C.
D'Avigdor-Goldsmid, Sir Henry


Alport, C. J. M.
Bowen, E. R. (Cardigan)
Deedee, W. F.


Amery, Julian (Preston, N.)
Boyle, Sir Edward
Dodds-Parker, A. D.


Amory, Rt. Hn. Heathcoat (Tiverton)
Bromley-Davenport, Lt.-Col. W. H.
Donaldson, Cmdr. C. E. McA.


Arbuthnot, John
Brooke, Rt. Hon. Henry
Doughty, C. J. A.


Armstrong, C. W.
Buchan-Hepburn, Rt. Hon. P. G. T.
du Cann, E. D. L.


Ashton, H.
Bullus, Wing Commander E. E.
Dugdale, Rt. Hn. Sir T. (Richmond)


Atkins, H. E.
Burden, F. F. A.
Duthie, W. S.


Baldock, Lt.-Cmdr. J. M.
Butcher, Sir Herbert
Elliot, Rt. Hon. W. E.


Balniel, Lord
Butler, Rt. Hn. R. A. (Saffron Walden)
Emmet, Hon. Mrs. Evelyn


Barter, John
Carr, Robert
Errington, Sir Eric


Baxter, Sir Beverley
Channon, H.
Farey-Jones, F. W.


Beamish, Maj. Tufton
Cole, Norman
Fell, A.


Bell, Philip (Bolton, E.)
Cooper-Key, E. M.
Finlay, Graeme


Bennett, Dr. Reginald
Cordeaux, Lt.-Col. J. K.
Fisher, Nigel


Bevins, J. R. (Toxteth)
Corfield, Capt. F. V.
Fleetwood-Hesketh, R. F.


Bidgood, J. C.
Crouch, R. F.
Fletcher-Cooke, C.


Biggs-Davison, J. A.
Cunningham, Knox
Fort, R.


Bishop, F. P.
Currie, G. B. H.
Foster, John


Black, C. W.
Dance, J. C. G.
Freeth, D. K.


Body, R. F.
Davidson, Viscountess
Garner-Evans, E. H.







George, J. C. (Pollok)
Kershaw, J. A.
Powell, J. Enoch


Gibson-Watt, D.
Kimball, M.
Prior, Brigadier O. L.


Glover, D.
Kirk, P. M.
Profumo, J. D.


Godber, J. B.
Lagden, G. W.
Raikes, Sir Victor


Gough, C. F. H.
Lambert, Hon. G.
Ramsden, J. E.


Gower, H. R.
Lancaster, Col. C. G.
Redmayne, M.


Graham, Sir Fergus
Langford-Holt, J. A.
Rees-Davies, W. R.


Grant, W. (Woodside)
Leather, E. H. C.
Remnant, Hon. P.


Grant-Ferris, Wg Cdr. R. (Nantwich)
Leavey, J. A.
Renton, D. L. M.


Green, A.
Legge-Bourke, Maj. E. A. H.
Ridsdale, J. E.


Gresham Cooke, R.
Legh, Hon. Peter (Petersfield)
Rippon, A. G. F.


Grimond, J.
Lindsay, Hon. James (Devon, N.)
Roberts, Sir Peter (Heeley)


Grimston, Hon. John (St. Albans)
Lindsay, Martin (Solihull)
Robertson, Sir David


Grimston, Sir Robert (Westbury)
Linstead, Sir H. N.
Robinson, Sir Roland (Blackpool, S.)


Grosvenor, Lt.-Col. R. G.
Lloyd, Maj. Sir Guy (Renfrew, E.)
Roper, Sir Harold


Gurden, Harold
Longden, Gilbert
Schofield, Lt.-Col. W.


Hall, John (Wycombe)
Lucas, Sir Jocelyn (Portsmouth, S.)
Shepherd, William


Harris, Frederic (Croydon, N. W.)
Lucas, P. B. (Brentford &amp; Chiswick)
Simon, J. E. S. (Middlesbrough, W.)


Harrison, A. B. C. (Maldon)
Lucas-Tooth, Sir Hugh
Smithers, Peter (Winchester)


Harvey, Air Cdre. A. V. (Macclesfd)
McAdden, S. J.
Spearman, Sir Alexander


Harvey, Ian (Harrow, E.)
Macdonald, Sir Peter
Spence, H. R. (Aberdeen, W.)


Harvey, John (Walthamstow, E.)
McKibbin, A. J.
Spens, Rt. Hn. Sir P. (Kens'gt'n, S.)


Head, Rt. Hon. A. H.
Mackie, J. H. (Galloway)
Stanley, Capt. Hon. Richard


Heald, Rt. Hon. Sir Lionel
McLaughlin, Mrs. P.
Steward, Harold (Stockport, S.)


Heath, Rt. Hon. E. R. G.
McLean, Neil (Inverness)
Steward, Sir William (Woolwich, W.)


Henderson, John (Cathoart)
Macmillan, Rt. Hn. Harold(Bromley)
Studholme, Sir Henry


Hicks-Beach, Maj. W. W.
Maddan, Martin
Summers, Sir Spencer


Hill, Rt. Hon. Charles (Luton)
Maitland, Hon. Patrick (Lanark)
Taylor, Sir Charles (Eastbourne)


Hill, Mrs. E. (Wythenshawe)
Marlowe, A. A. H.
Taylor, William (Bradford, N.)


Hinchingbrooke, Viscount
Marples, A. E.
Thomas, P. J. M. (Conway)


Hirst, Geoffrey
Mathew, R.
Thompson, Kenneth (Walton)


Holland-Martin, C. J.
Maude, Angus
Thompson, Lt.-Cdr. R. (Croydon, S.)


Holt, A. F.
Maudling, Rt. Hon. R.
Thornton-Kemsley, C. N.


Hope, Lord John
Mawby, R. L.
Turner, H. F. L.


Hornby, R. P.
Maydon, Lt.-Comdr. S. L. C.
Turton, Rt. Hon. R. H.


Horobin, Sir Ian
Medlicott, Sir Frank
Vane, W. M. F.


Horsbrugh, Rt. Hon. Dame Florence
Milligan, Rt. Hon. W. R.
Vaughan-Morgan, J. K.


Howard, Hon. Greville (St. Ives)
Molson, Rt. Hon. Hugh
Vickers, Miss J. H.


Howard, John (Test)
Moore, Sir Thomas
Vosper, D. F.


Hudson, Sir Austin (Lewisham, N.)
Morrison, John (Salisbury)
Wade, D. W.


Hughes Hallett, Vice-Admiral J.
Nabarro, G. D. N.
Wakefield, Edward (Derbyshire, W.)


Hughes-Young, M. H. C.
Nairn, D. L. S.
Wall, Major Patrick


Hutchison, Sir Ian Clark (E'b'gh, W.)
Neave, Airey
Ward, Hon. George (Worcester)


Hylton-Foster, Sir H. B. H.
Nicholson, Godfrey (Farnham)
Ward, Dame Irene (Tynemouth)


Iremonger, T. L.
Nicolson, N. (B'n'm'th &amp; Chr'ch)
Waterhouse, Capt. Rt. Hon. C.


Irvine, Bryant Godman (Rye)
Nield, Basil (Chester)
Whitelaw, W. S. I. (Penrith &amp; Border)


Jenkins, Robert (Dulwich)
Nugent, G. R. H.
Williams, Paul (Sunderland, S.)


Jennings, J. C. (Burton)
Oakshott, H. D.
Williams, R. Dudley (Exeter)


Johnson, Dr. Donald (Carlisle)
O'Neill, Hn. Phelim (Co. Antrim, N.)
Wills, G. (Bridgwater)


Johnson, Eric (Blackley)
Ormsby-Gore, Hon. W. D.
Wilson, G. (Truro)


Jones, Rt. Hon. Aubrey (Hall Green)
Osborne, C.
Woollam, John Victor


Joseph, Sir Keith
Page, R. G.



Kaberry, D.
Pannell, N. A. (Kirkdale)
TELLERS FOR THE NOES:


Keegan, D.
Peyton, J. W. W.
Colonel J. H. Harrison and


Kerr, H. W.
Pitt, Miss E. M.
Mr. Barber.

New Clause.—(EXEMPTION OF FOOTBALL MATCHES (RUGBY LEAGUE) FROM ENTERTAIMENTS DUTY.)

(1) Football matches shall be excluded from the entertainments in respect of which entertainments duty is payable and references in the enactment relating to that duty to an entertainment shall be construed accordingly.

(2) This section shall apply to all matches played after the first day of August, nineteen hundred and fifty-six.

(3) For the purpose of this section "football matches" shall include all matches played under the rules of the Rugby League.—[Mr. Hobson.]

Brought up, and read the First time.

Motion made, and Question put, That the Clause be read a Second time:—

The Committee divided: Ayes 166, Noes 223.

Division No. 235.]
AYES
[11.22 p.m.


Ainsley, J. W.
Blenkinsop, A.
Burton, Miss F. E.


Albu, A. H.
Blyton, W. R.
Butler, Herbert (Hackney, C.)


Allaun, Frank (Salford, E.)
Boardman, H.
Castle, Mrs. B. A.


Allen, Arthur (Bosworth)
Bottomley, Rt. Hon. A. G.
Chetwynd, G. R.


Allen, Scholefield (Crewe)
Bowden, H. W. (Leicester, S. W.)
Coldrick, W.


Awbery, S. S.
Boyd, T. C.
Collick, P. H. (Birkenhead)


Bacon, Miss Alice
Braddock, Mrs. Elizabeth
Corbet, Mrs. Freda


Baird, J.
Brockway, A. F.
Craddock, George (Bradford, S.)


Benson, G.
Broughton, Dr. A. D. D.
Cronin, J. D.


Beswick, F.
Brown, Rt. Hon. George (Belper)
Davies, Ernest (Enfield, E.)


Blackburn, F.
Brown, Thomas (Ince)
Deer, G.




de Freitas, Geoffrey
Jenkins, Roy (Stechford)
Pearson, A.


Delargy, H. J.
Johnson, James (Rugby)
Peart, T. F.


Dodds, N. N.
Johnston, Douglas (Paisley)
Price, J. T. (Westhoughton)


Donnelly, D. L.
Jones, Rt. Hon. A. Creech (Wakefield)
Price, Philips (Gloucestershire, W.)


Dugdale, Rt. Hn. John (W.Brmwch)
Jones, Elwyn (W. Ham, S.)
Probert, A. R.


Ede, Rt. Hon. J. C.
Jones, Jack (Rotherham)
Pryde, D. J.


Edelman, M.
Jones, J. Idwal (Wrexham)
Randall, H. E.


Edwards, Robert (Bilston)
Jones, T. W. (Merioneth)
Redhead, E. C.


Evans, Albert (Islington, S. W.)
Kenyon, C.
Roberts, Albert (Normanton)


Evans, Edward (Lowestoft)
King, Dr. H. M.
Roberts, Goronwy (Caernarvon)


Fernyhough, E.
Lawson, G. M.
Robinson, Kenneth (St. Pancras, N.)


Finch, H. J.
Lever, Harold (Cheetham)
Ross, William


Fletcher, Eric
Lever, Leslie (Ardwick)
Shurmer, P. L. E.


Forman, J. C.
Lewis, Arthur
Simmons, C. J. (Brierley Hill)


Fraser, Thomas (Hamilton)
Logan, D. G.
Slater, Mrs. H. (Stoke, N.)


Gaitskell, Rt. Hon. H. T. N.
Mabon, Dr. J. Dickson
Slater, J. (Sedgefield)


Gibson, C. W.
MacColl, J. E.
Smith, Ellis (Stoke, S.)


Gordon Walker, Rt. Hon. P. C.
McGhee, H. G.
Snow, J. W.


Greenwood, Anthony
McInnes, J.
Sorensen, R. W.


Grey, C. F.
McKay, John (WallSend)
Sparks, J. A.


Griffiths, David (Rother Valley)
Mahon, Simon
Stokes, Rt. Hon. R. R. (Ipswich)


Griffiths, Rt. Hon. James (Llanelly)
Mallalieu, E. L. (Brigg)
Stones, W. (Consett)


Griffiths, William (Exchange)
Mallalieu, J. P. W. (Huddersfd, E.)
Strachey, Rt. Hon. J.


Hale, Leslie
Mann, Mrs. Jean
Stross, Dr. Barnett (Stoke-on-Trent, C.)


Hall, Rt. Hn. Glenvil (Colne Valley)
Mason, Roy
Summerskill, Rt. Hon. E.


Hannan, W.
Mayhew, C. P.
Sylvester, G. O.


Harrison, J. (Nottingham, N.)
Mikardo, Ian
Taylor, Bernard (Mansfield)


Hayman, F. H.
Mitchison, G. R.
Thomas, George (Cardiff)


Healey, Denis
Monslow, W.
Thornton, E.


Henderson, Rt. Hn. A. (Rwly Regis)
Moody, A. S.
Tomney, F.


Herbison, Miss M.
Mort, D. L.
Turner-Samuels, M.


Hewitson, Capt. M.
Moyle, A.
Ungoed-Thomas, Sir Lynn


Hobson, C. R.
Mulley, F. W.
Weitzman, D.


Holman, P.
Neal, Harold (Bolsover)
Wheeldon, W. E.


Holmes, Horace
Noel-Baker, Rt. Hon. P. (Derby, S.)
White, Henry (Derbyshire, N. E.)


Howell, Charles (Perry Barr)
O'Brien, Sir Thomas
Wilkins, W. A.


Hubbard, T. F.
Oliver, G. H.
Williams, R. Hon. T. (Don Valley)


Hughes, Emrys (S. Ayrshire)
Oram, A. E.
Williams, W. R. (Openshaw)


Hunter, A. E.
Orbach, M.
Wilson, Rt. Hon. Harold (Huyton)


Irvine, A. J. (Edge Hill)
Oswald. T.
Woof, R. E.


Irving, S. (Dartford)
Paling, Rt. Hon. W. (Dearne Valley)
Yates, V. (Ladywood)


Isaacs, Rt. Hon. G. A.
Palmer, A. M. F.
Younger, Rt. Hon. K.


Janner, B.
Pargiter, G. A.
Zilliacus, K.


Jay, Rt. Hon. D. P. T.
Parker, J.
TELLERS FOR THE AYES:


Jeger, George (Goole)
Parkin, B. T.
Mr. Short and Mr. Rogers.




NOES


Allan, R. A. (Paddington, S.)
Cooper-Key, E. M.
Grant, W. (Woodside)


Alport, C. J. M.
Cordeaux, Lt.-Col. J. K.
Grant-Ferris, Wg Cdr. R. (Nantwich)


Amery, Julian (Preston, N.)
Corfield, Capt. F. V.
Green, A.


Amory, Rt. Hn. Heathcoat (Tiverton)
Crouch, R. F.
Gresham Cooke, R.


Arbuthnot, John
Cunningham, Knox
Grimond, J.


Armstrong, C. W.
Currie, G. B. H.
Grimston, Hon John (St. Albans)


Ashton, H.
Dance, J. C. G.
Grimston, Sir Robert (Westbury)


Atkins, H. E.
Davidson, Viscountess
Grosvenor, Lt.-Col. R. G.


Baldock, Lt.-Cmdr. J. M.
D'Avigdor-Goldsmid, Sir Henry
Gurden, Harold


Balniel, Lord
Deedes, W. F.
Hall, John (Wycombe)


Barber, Anthony
Dodds-Parker, A. D.
Harris, Frederic (Croydon, N.W.)


Barter, John
Donaldson, Cmdr. C. E. McA.
Harrison, A. B. C. (Maldon)


Baxter, Sir Beverley
Doughty, C. J. A.
Harrison, Col. J. H. (Eye)


Beamish, Maj. Tufton
du Cann, E. D. L.
Harvey, Air Cdre. A. V. (Macclesfd)


Bell, Philip (Bolton, E.)
Dugdale, Rt. Hn. Sir T. (Richmond)
Harvey, Ian (Harrow, E.)


Bennett, Dr. Reginald
Duthie, W. S.
Harvey, John (Walthamstow, E.)


Bevins, J. R. (Toxteth)
Elliot, Rt. Hon. W. E.
Head, Rt. Hon. A. H.


Bidgood, J. C.
Emmet, Hon. Mrs. Evelyn
Heald, Rt. Hon. Sir Lionel


Biggs-Davison, J. A.
Errington, Sir Eric
Heath, Rt. Hon. E. R. G.


Bishop, F. P.
Farey-Jones, F. W.
Henderson, John (Cathcart)


Black, C. W.
Fell, A.
Hill, Rt. Hon. Charles (Luton)


Body, R. F.
Finlay, Graeme
Hill, Mrs. E. (Wythenshawe)


Boothby, Sir Robert
Fisher, Nigel
Hinchingbrooke, Viscount


Bossom, Sir A. C.
Fleetwood-Hesketh, R. F.
Hirst, Geoffrey


Bowen, E. R. (Cardigan)
Fletcher-Cooke, C.
Holland-Martin, C. J.


Boyle, Sir Edward
Fort, R.
Holt, A. F.


Bromley-Davenport, Lt.-Col. W. H.
Foster, John
Hope, Lord John


Brooke, Rt. Hon. Henry
Freeth, D. K.
Hornby, R. P.


Buchan-Hepburn, Rt. Hon. P. G. T.
Garner-Evans, E. H.
Horobin, Sir Ian


Bullus, Wing Commander E. E.
George, J. C. (Pollok)
Horsbrugh, Rt. Hon. Dame Florence


Burden, F. F. A.
Gibson-Watt, D.
Howard, Hon. Greville (St. Ives)


Butcher, Sir Herbert
Glover, D.
Howard, John (Test)


Butler, Rt. Hn. R. A. (Saffron Walden)
Godber, J. B.
Hudson, Sir Austin (Lewisham, N.)


Carr, Robert
Gough, C. F. H.
Hughes Hallett, Vice-Admiral J.


Channon, H.
Gower, H. R.
Hughes-Young, M. H. C.


Cole, Norman
Graham, Sir Fergus
Hutchison, Sir Ian Clark (E'b'gh, W.)







Hylton-Foster, Sir H. B. H.
Marples, A. E.
Robinson, Sir Roland (Blackpool, S.)


Iremonger, T. L.
Mathew, R.
Roper, Sir Harold


Irvine, Bryant Godman (Rye)
Maude, Angus
Schofield, Lt.-Col. W.


Jenkins, Robert (Dulwich)
Maudling, Rt. Hon. R.
Shepherd, William


Jennings, J. C. (Burton)
Mawby, R. L.
Simon, J. E. S. (Middlesbrough, W.)


Johnson, Dr. Donald (Carlisle)
Maydon, Lt.-Comdr. S. L. C.
Smithers, Peter (Winchester)


Johnson, Eric (Blackley)
Medlicott, Sir Frank
Spearman, Sir Alexander


Jones, Rt. Hon. Aubrey (Hall Green)
Milligan, Rt. Hon. W. R.
Spence, H. R. (Aberdeen, W.)


Joseph, Sir Keith
Molson, Rt. Hon. Hugh
Spens, Rt. Hn. Sir P. (Kens'gt'n, S.)


Kaberry, D.
Moore, Sir Thomas
Stanley, Capt. Hon. Richard


Keegan, D.
Morrison, John (Salisbury)
Steward, Harold (Stockport, S.)


Kerr, H. W.
Nabarro, G. D. N.
Steward, Sir William (Woolwich, W.)


Kershaw, J. A.
Nairn, D. L. S.
Studholme, Sir Henry


Kimball, M.
Neave, Airey
Summers, Sir Spencer


Kirk, P. M.
Nicholson, Godfrey (Farnham)
Taylor, Sir Charles (Eastbourne)


Lagden, G. W.
Nicolson, N. (B'n'm'th, E. &amp; Chr'ch)
Taylor, William (Bradford, N.)


Lambert, Hon. G.
Nield, Basil (Chester)
Thomas, P. J. M. (Conway)


Lancaster, Col. C. G.
Nugent, G. R. H.
Thompson, Kenneth (Walton)


Langford-Holt, J. A.
Oakshott, H. D.
Thompson, Lt.-Cdr. R. (Croydon, S.)


Leather, E. H. C.
O'Neill, Hn. Phelim (Co. Antrim, N.)
Thornton-Kemsley, C. N.


Leavey, J. A.
Ormsby-Gore, Hon. W. D.
Turner, H. F. L.


Legge-Bourke, Maj. E. A. H.
Osborne, C.
Turton, Rt. Hon. R. H.


Legh, Hon. Peter (Petersfield)
Page, R. G.
Vane, W. M. F.


Lindsay, Hon. James (Devon, N.)
Pannell, N. A. (Kirkdale)
Vaughan-Morgan, J. K.


Lindsay, Martin (Solihull)
Peyton, J. W. W.
Vickers, Miss J. H.


Linstead, Sir H. N.
Pitt, Miss E. M.
Vosper, D. F.


Lloyd, Maj. Sir Guy (Renfrew, E.)
Powell, J. Enoch
Wade, D. W.


Longden, Gilbert
Prior-Palmer, Brig. O. L.
Wall, Major Patrick


Lucas, Sir Jocelyn (Portsmouth, S.)
Profumo, J. D.
Ward, Hon. George (Worcester)


Lucas-Tooth, Sir Hugh
Raikes, Sir Victor
Ward, Dame Irene (Tynemouth)


McAdden, S. J.
Ramsden, J. E.
Waterhouse, Capt. Rt. Hon. C.


Macdonald, Sir Peter
Redmayne, M.
Whitelaw, W. S. I. (Penrith &amp; Border)


McKibbin, A. J.
Rees-Davies, W. R.
Williams, Paul (Sunderland, S.)


Mackie, J. H. (Galloway)
Remnant, Hon. P.
Williams, R. Dudley (Exeter)


McLaughlin, Mrs. P.
Renton, D. L. M.
Wilson, Geoffrey (Truro)


McLean, Neil (Inverness)
Ridsdale, J. E.
Wood, Hon. R.


Macmillan, Rt. Hn. Harold (Bromley)
Rippon, A. G. F.
Woollam, John Victor


Maddan, Martin
Roberts, Sir Peter (Heeley)
TELLERS FOR THE NOES:


Marlowe, A. A. H.
Robertson, Sir David
Mr. Wills and Mr. Edward Wakefield.


Question put and agreed to.

New Clause.—(RELIEF FROM PROFITS TAX WHERE PROFITS ARE PAID TO EMPLOYEES.)

(1) If the gross relevant distribution to proprietors for any chargeable accounting period of a body corporate, society or other body include a preference dividend or preference dividends (as defined in subsection (2) of section one hundred and eighty-five of the Income Tax Act, 1952) and if the body corporate, society or other body has paid a charge for profit sharing in respect of the chargeable accounting period, the profits tax payable by the body corporate, society or other body shall be reduced as provided in the following provisions of this section.

(2) The difference between the profits tax which would have been payable if the preference dividend referred to in subsection (1) of this section were left out of account in determining the net relevant distributions to proprietors for the chargeable accounting period, and the profits tax payable for the chargeable accounting period apart from the provisions of this section, shall be ascertained, and the profits tax payable shall be reduced by such proportion of this difference as the charge for profit sharing bears to the profits as computed for profits tax purposes including franked investment income and after deducting the said preference dividends but before deducting the charge for profit sharing.

(3) For the purpose of this section "charge for profit sharing" means—

(i) the cost incurred for the chargeable accounting period (including any dividend paid or provided) in respect of any profit

sharing scheme whereby the whole or part of the profits of the body corporate, society or other body is shared on a predetermined basis among all the employees of the body corporate, society, or other body who are entitled to participate in the scheme (not being less than three-fourths of the total number of the employees) and such sharing is made in addition to the payment to such employees of emoluments at rates not less than those generally prevailing in the class of trade or business to which the body corporate, society or other body belongs; and
(ii) the contributions allowed as a deduction in computing the profits of the body corporate, society or other body (being a body corporate, society or other body having such a profit sharing scheme) for the chargeable accounting period for the purposes of the profits tax to any scheme for the provision of pension or other retirement benefits for the employees of the body corporate, society or other body or their dependants.—[Mr. Thornton-Kemsley.]

Brought up, and read the First time.

11.30 p.m.

Mr. C. N. Thornton-Kemsley: I beg to move, That the Clause be read a Second time.

The Temporary Chairman: I think it would be for the convenience of the Committee to consider with this new Clause the two new Clauses in the name of the hon. Member for Orkney and


Shetland (Mr. Grimond), "Tax relief for approved co-ownership schemes", and "Exemption from Schedule E income tax of benefits received under co-ownership schemes".

Mr. Thornton-Kemsley: The Chancellor of the Exchequer reminded the Committee just now that the only remission which he had been able to make as a result of his Budget was in the case of savings. I make bold to ask that the should make one further remission in the case of another socially desirable object, that of profit sharing. If I were asked to explain this long and rather complicated new Clause, I should say that it seeks to reduce the Profits Tax on distributed profits payable on the preference dividends of companies which share the whole or part of their profits among the workers by the proportion in which the profits which remain after the payment of preference dividends are used for profit sharing.
There is a very important qualification for relief, and I would draw the attention of the Committee to that, for as the Clause is drawn the profit sharing, to qualify for relief, must, first, be in accordance with a bona fide scheme. Secondly, the scheme must provide for the sharing of profits upon a predetermined basis among all the workers who are entitled to participate. It would thus rule out the haphazard distribution of bonuses at Christmas time or on other special occasions. Thirdly, the scheme must cover not fewer than three-quarters of the workers in the company concerned. Finally—and I am sure that all hon. Members will attach great importance to this—the profit sharing must be in addition to the payment of fair wages; that is to say, that wages must not be less than those which generally prevail in the trade or industry concerned.
The Committee will be aware that last November, at the beginning of the month, Profits Tax stood at 22½ per cent. By the autumn Budget the tax on distributed profits was increased by 5 per cent. to 27½ per cent. Now, by my right hon. Friend's Budget and this Bill, it is increased to 30 per cent. Taxation of this order, while it hits all productive industry, constitutes a heavy extra burden of taxation upon companies which are based upon the

principles of co-partnership and profit sharing. The Clause is designed to encourage the formation of such schemes, which I am sure all of us want to see, by removing the burden of Profits Tax from that part of the profit which goes to the workers under a bona fide profit-sharing scheme.
Hon. Members who are familiar with these matters will be aware that the charge for tax on distributed profits is made in such a way that all charges upon profits paid out on preference dividends fall normally on the equity shareholders. In companies in which the equity shares are held by or on behalf of the workers—I am assured that it is not uncommon—or, indeed, in the case of any co-partnership scheme which places the workers, as regards their share of the profits, on a par with the equity shareholders, it is the workers who have to bear a proportion of the tax upon the preference dividends. The Clause seeks to remedy this unfortunate and, I believe, unintended effect of the tax on distributed profits.
Let me try to explain the rather complicated way in which the Clause seeks to achieve these objects. I should say that none of us is wedded to the particular wording of the Clause. It is extremely complicated and I can only say that I am advised that simplicity would not achieve the object that we desire. My hon. Friends and I would be extremely happy if the Government tell us that they dislike the wording, but are sympathetic with the object we want to achieve, and that if we withdraw the Clause they will put down their own form of words on Report.
The Clause provides, first, that the tax on distributed profits shall be calculated in the ordinary way; and, secondly, that it shall be ascertained by treating the preference dividend as though it were not in fact a distribution of profits. The difference, as hon. Members will realise, represents the Profits Tax upon the distributed preference dividend. This would be reduced to the extent that the share of the profits goes to the workers.
One might at first blush imagine that, to take a simple example, a company making a profit of, say, £4,000 and having to pay £2,000 in preference dividends would have £2,000 left for


profit sharing provided it had a profit-sharing scheme under which the remaining profits went to the workers. At the rates now proposed, however, not less than £1,100 would be taken to cover the tax.
That is arrived at as follows: First, Income Tax at 8s. 6d. in the £ on £1,100 comes to £467; the distributed Profits Tax at 30 per cent. on the dividend of £2,000 is £600, and the Profits Tax at 3 per cent. on the undistributed £1,100 is £33, making a total of £1,100, as I mentioned. So the company has only £2,900 instead of £4,000 to divide and, since it must meet its preference dividends, only £900 will be left to divide among the workers. In larger companies, of course, the figures are proportionately larger.
It is true that the £900 which goes to the workers is not treated as part of the profits. That is allowed as a deduction in the ordinary course of events. The Clause has nothing whatever to do with that; that happens already. The profits distributed to employees are taxed not in the company's hands but, on the appropriate P.A.Y.E. scale, in the hands of the workers. The point of the Clause is that the lower payment of preference dividends by a company which has a scheme of profit-sharing reduces savagely and, as I think, inequitably, the amount of profit left to apply for distribution among the workers. It is that unreasonable reduction which the Clause seeks to mitigate.

Mr. F. Beswick: I am trying very hard to follow this rather complicated business. In the example which the hon. Gentleman gave he is assuming that the whole of the non-preference share capital is held by the workers. Assuming—as is most likely to be the case—that only a small proportion of the non-preference share capital is held by any form of co-partnership arrangement, how does the hon. Gentleman estimate the difference in the taxation for that proportion of the shareholding held by the employees?

Mr. Thornton-Kemsley: I gave a simple example because I thought it would make it easier to understand. The proposal can be examined in the light of day, when it appears in print. I cannot hope to

show anybody how the proposal works in detail, with this rather abstruse method of calculation, but it would work in the same way pari passu with a smaller distribution to the workers. In the example I have given, under the Clause as it has been drafted the amount left for profit sharing, instead of being reduced to £900 out of the original £2,000, would be reduced only to about £1,800.
I ought, perhaps, to declare an interest. It happens that since the war I have been associated with the John Lewis Partnership, in the capacity of consultant surveyor, and I have a seat on the property board. For that I receive a very modest retaining fee, but the fact that I receive that fee enables me to participate in the distribution of general bonuses because, as some hon. Members know, in the partnership scheme the whole of the profits—after the payment of fixed interest charges, amounting to rather less than 4½ per cent. on the whole of the capital investment in the partnership, and the usual provisions for reserves—go in one way or another to all the workers in the scheme. The workers are known as, and treated as, partners from the moment they join.
11.45 p.m.
From my own experience of co-partnership and profit-sharing schemes in action, I would never claim that that is the only incentive to increased production, nor would I claim that it is a powerful incentive. Although, in some productive industries, bonus schemes have shown notable results, in the distributive trades the results are more difficult to assess. It is true that with co-partnership schemes, as I once heard Lord Bruce of Melbourne say—and in his early days he once worked for a company which had a flourishing co-partnership scheme in operation—companies running these schemes tend to attract the best type of workers.
I think that the great merit of profit-sharing schemes is that they are never found in isolation. Almost invariably they are accompanied, first, by generous provisions for the social security and collective amenities of the workers in the company, and, secondly, by sound and sensible arrangements for joint consultation between management and the managed. The reason is that in almost


every case they are founded on the rejection of the doctrine once described by J. R. Green, the great English historian, as
the social seventh between the employers and employed.
They are founded on the principle that masters and men in any company, industry or trade are utterly dependent one upon the other. They are founded upon the recognition of the fact that man does not live by bread alone, and that he is very much more than a cog in someone else's machine.
I am proud that the Conservative Party believes that co-partnership and profit-sharing schemes should be encouraged. It has said so many times. It said so in those very words in the 1955 Election Manifesto. How could this be done by any other than fiscal means? I remember that some years ago, before we were in office, my right hon. Friend the Leader of the House addressed a meeting of the Industrial Co-partnership Association and warmly commended schemes of co-partnership and profit-sharing. The chair at that meeting was taken by my right hon. Friend the Minister of Agriculture, Fisheries and Food.
My right hon. Friend the Chancellor of the Exchequer himself wrote a book called "The Middle Way", which I re-read the other day, and his former Parliamentary Secretary—

Mr. H. Wilson: On a point of order, Sir Charles. We are being very patient. There are 70 members of the Government. Are we to have all of them invoked before the hon. Gentleman sits down?

Mr. Thornton-Kemsley: I have very nearly come to the end of what I wish to say. I could not bring all 70 members of the Government to my support, but I could bring one or two more. I was about to say that the former Parliamentary Secretary to the Ministry of Housing and Local Government, my hon. Friend the Member for Wallasey (Mr. Marples), wrote a book on co-partnership called "The Road to Prosperity."
I recall that the National Liberals, with whom I am associated, gave powerful support to the idea of profit-sharing in the Report of the Committee presided over by a former colleague of ours Sir Geoffrey Shakespeare, and on that Com-

mittee there were two members of the present Government. I do not forget that the present Prime Minister has spoken strongly in favour of co-partnership and profit sharing. The Government, individually and collectively, are deeply committed to the idea of support of co-partnership and profit sharing. Now is the time, here is the opportunity, to show that we mean what we say.

Mr. Arthur Holt: I am very glad to rise now after having had the assurance of the hon. Member for North Angus and Mearns (Mr. Thornton-Kemsley) that the policy of the Conservative Party as announced on numerous occasions is strongly to encourage co-partnership and profit sharing, but, in view of the lateness of the hour, I would not be really acting in the interests of the Committee if I commented at length on the new Clause put forward by the hon. Member.
I should like to speak for a few moments on the two proposed new Clauses in the names of my hon. Friend the Member for Orkney and Shetland (Mr. Grimond) and other hon. Members of my party. Those Clauses deal with two quite simple matters. The first of them has the object of putting ownership of shares and the propagation of the idea of ownership of shares on the same basis from a taxation point of view as bonuses given to workpeople. It is not a case of giving special tax concessions to encourage ownership, but merely to put them on the same basis.
At present, the taxation system works in favour of cash bonuses to workpeople, but does not encourage the giving or the assisting of buying of shares in the company in which the employee works. If a firm were prepared to give £10,000 to workers in cash that sum would not be taxable for the company. Its profits are arrived at after that £10,000 has been allowed for in the accounts. It is, as it were, a cost to the company. If, on the other hand, that company decided to pass over to its workers a similar value, but did not wish to give them cash, it would give them £10,000 worth of shares and the gross profits of the company would be increased to the extent of that £10,000. Therefore, it would pay a greater rate of tax.
The point of the second of these two Clauses is that when an employee receives


a cash bonus he pays tax on that money in accordance with the taxation applicable to his income. If an employee has a large income he may pay tax on that cash bonus at the full rate, but if he is only a small wage-earner he may pay little or no tax on it. On the other hand, if he receives an equivalent value in the form of shares in the company, receiving no cash at all, he is still assessed for tax as if he had received cash, although he has no cash with which to pay the tax.
Often, when an employee is offered shares, he thinks it is a fine idea; but he receives no money—only a piece of paper—and then receives a request from the tax office for tax on the shares as if he had been paid the cash. The second Clause which we have put down does not suggest that he should not be liable to tax at all, but suggests that he should pay tax only when he eventually sells those shares to another party.
We feel that in the two Clauses we have tried to deal with the problem realistically and without giving preferential treatment to co-ownership or co-partnership. Today, the taxation system works against them. We suggest that if the new Clauses were accepted, and the taxation system altered, it would put them on the same basis as a profits bonus. Where a company thought the right thing was to give the money away, it could do so entirely on the merits of the matter; but if it wished to retain the cash in the business for development and to make its work-people feel they had a closer tie with the company by giving them shares, it could do that, too—and there would be no difference in the taxation position between the two methods.
In supporting the Clauses I am fortified by the knowledge of what leading members of the Government have said about this kind of thing in the past, particularly the Prime Minister, in his first speech in the House after the General Election, when he said, granted in vague terms, as the major point in his speech on the Address, that the Conservative Party wished to welcome all forms of co-ownership, co-partnership and profit sharing. In our new Clauses we merely put one method on the same basis as another.
I hope that the Government will welcome this opportunity of telling the Committee exactly what their thoughts are on the matter. Hon. Members have suggested on various occasions in the last few years that the Government should examine the taxation position in relation to this kind of thing because it is not working satisfactorily, if the idea is to encourage it. I asked the Government whether they would start an inquiry into the taxation system in this matter to see how it could be altered. So far, we have had no reply from them on what they are willing to do and, even though he may not be in a position to accept these Clauses, I hope that the Economic Secretary tonight will take the opportunity of being frank with the Committee and saying to what extent the Government are prepared to consider alterations so as to encourage these methods. I would, in fact, be very willing to confine my remarks to those if I could be assured that they would enable the Economic Secretary to give a full reply. But if there are parts of this Clause which are not clear to him, no doubt there will be an opportunity of explaining them later on.
12 midnight.
On the whole, I think that the Clause we have put down is fairly self-explanatory and does not need much explanation through lack of clarity. It is based entirely on there being a scheme put before the Commissioners, the general principles of which are laid down in subsection (2, a) of the first proposed new Clause in the name of my hon. Friend the Member for Orkney and Shetland, there being a limit of £200 which is the greatest benefit which can be obtained in any one year, to avoid any possibility that the scheme might be misused. Of course, there should be no possibility that such a scheme might be misused because the Commissioners could always withdraw their approval if the scheme were being used for objects other than those stated in subsection (2, a) of my hon. Friend's new Clause
to enable persons employed by a body corporate to acquire on favourable terms shares therein".
It needs some encouragement to bring employees into this new field in which they have not been before, although at a time when the standard of living is rising, as the Lord Privy Seal said it would do in


the course of the next 25 years, many employees are likely to be interested in this kind of thing. If an employee gets a share at a time when the market is high and it drops in value by 5s. or so within six months, he will wonder whether this is such a good scheme, as this will be an entirely new experience for him.
Therefore, in the initiation of these schemes, I think there is a substantial case for the company offering these shares at considerably below their market price, and that is why we say in the new Clause "on favourable terms." Beyond that, I believe the whole idea will commend itself to them and will be a success.
From the Chancellor's point of view, there is no reason why he should not accept this Clause or something like it, even this year, because the cost to the Chancellor this year would be negligible. It has the merit of being a scheme which would tend to discourage consumer spending at the moment, and to increase saving and subsequently investment, and it will cost a considerable sum of money only if the idea grows. In that case it may in future years cost the Chancellor quite a sum of money, but he should be able to afford it in the future. This year, however, the cost will be negligible. I hope, therefore, that we shall have a favourable reply from the Economic Secretary.

Mr. Edward Short: I wish to support the new Clause in the name of the hon. Member for North Angus (Mr. Thornton-Kemsley), but I have a qualification. I want to make it clear that neither I nor any of my colleagues regard profit-sharing schemes as a substitute for Socialism. Industry today has completely lost its old handicraft aspect. It has become a social activity, a social function. Therefore, we believe that it should be subject to social control. In most cases we think that there cannot be proper social control unless there is social ownership.
Nevertheless, the profit-sharing scheme is better than the normal out-and-out capitalism. It goes some way towards meeting the Socialist criticism that the worker does not get the full reward for his labour. However, in a profit-sharing industry, the undertaking is not conducted primarily in the public interest. It is conducted primarily to make profit. That

is one of our criticisms of it. In a profit-sharing industry the industry is still controlled by a small group of directors; it is not conducted primarily in the public interest by the public; but I suppose that Sidney Webb, who was the father of most of our modern democratic Socialism, regarded any step towards collectivism as a step towards Socialism, and I think he was about right so long as we do not mistake the initial steps for the end product.
That is my qualification—that I think it goes a little way, but neither I nor my colleagues regard it as a substitute for the things for which we stand.
Having made my qualification, I want now to give the new Clause my support. There is in my constituency a firm called Bainbridge, Ltd., which is a very big and, I may say, good shop. For some years it has been a branch of the John Lewis Partnership. In the John Lewis Partnership the greatest part of the capital is preference stock subscribed many years ago. The partnership believes that it must keep faith with the lenders of the preference capital and, of course, it pays the dividend on the preference capital as it becomes due. That dividend takes each year £400,000. If the Finance Bill remains unamended, the Distributed Profits Tax on that £400,000 will be about £100,000; but that £100,000 itself, of course, is paid out of profits on which Income Tax has already been paid. That means that nearly £200,000 of trading profit is required to pay the distributed Profits Tax on the preference dividend.
There are no outside holders of any of the partnership's ordinary shares. Each year the partnership places some of its profits to reserve. That means that every year after the preference dividend is paid and after the distributed Profits Tax is paid, the whole of the profits are returned to the workers. There are in the partnership 12,000 workers whose average wage is the very low one of £7 per week. To pay the distributed Profits Tax £200,000 of trading profit is required, and that means that the workers who participate in the profit-sharing scheme lose the equivalent of two weeks pay each year—just over £14 each per year.

Mr. Beswick: Is there any reason why that wage should not be increased from £7 to £9 per week, so that no tax should be incurred?

Mr. Short: None whatever. I think that that is often a good criticism of profit-sharing schemes. It is a valid criticism of the rather "phoney" profit-sharing scheme of I.C.I. but less so of this one.
There are two safeguards in the Clause. One is that it must be a genuine profit-sharing scheme. The other is that the reduction in the Profits Tax must be proportionate to the extent to which the profits which remain after the preference dividends are paid are actually used in profit-sharing. It is because of these two safeguards that I feel I can support the Clause. I think that it is perhaps a good thing, subject to all the qualifications I made at the outset.

Mr. Raymond Gower: I should like to support the Clause whch has been moved by my hon. Friend the Member for North Angus (Mr. Thornton-Kemsley). Two years ago, in the last Parliament, I had the honour of introducing a Motion in the House of Commons which I believe was the first Motion ever introduced on the subjects which we are now discussing. It was approved without a Division. It called attention in a limited way to the extension of schemes of co-partnership and profit-sharing in recent years and asked the Government to acquaint themselves with information about such schemes. At that time the then Minister of Labour, my right hon. and learned Friend the Member for Bristol, West (Sir Walter Monckton), through his Parliamentary Secretary, gave certain undertakings to provide such information in the Ministry of Labour Gazette.
It has been very obvious to me, as I am sure it has been to all hon. Members, that that was merely an inadequate beginning. All parties in the House of Commons recognise the value of these schemes. They are valuable in so far as they express good relationships in industry and represent good firms paying the best wages, providing the best amenities, observing all the best trade union standards and having the best joint consultation. All those things are prerequisites of any such scheme as those we have been discussing tonight.
It has been apparent that just to take note and approve of these things is inadequate. It seems to many of us that

Governments must now provide some fiscal incentives for the extension of these schemes. We have before us two very limited proposals for the provision of such incentives. Perhaps we should go further, but I hope that the Economic Secretary will be able to say that, though the Government may not adopt the wording of either of the proposals, they realise the need for some incentives, beyond indicating approval or providing information.
It is obvious that in our fiscal system greater incentives are provided for other schemes, such as arrangements for pensions, than for schemes of this kind. We deem these schemes as fully important in the long run as are pension schemes, though those should come first. We see no reason why incentives provided for pension and sickness benefit schemes should not also be available to provide for profit-sharing and co-partnership schemes. I believe that I speak for my hon. Friend the Member for North Angus as well as myself when I say that we are not attached to any particular formula. We have taken the opportunity tonight to put forward in a positive way the need for financial incentives.
12.15 a.m.
As I have said, in the last Parliament, the Government accepted a Motion approving co-partnership, and the Opposition then signified its approval of it. On that occasion many Opposition hon. Members and many of my hon. Friends paid tribute to the work of the Co-operative movement in this respect. Co-partnership has been widely applied within the Co-operative movement; some of the best schemes exist as a result of the pioneer work done by co-operative societies. We have today many excellent schemes in this country. We had evidence that even in the bad years of depression the good schemes tended to survive. It was only the poorly organised, hastily created schemes which then came to an end.
We have now had more experience in this country of profit-sharing and co-partnership. These schemes can do a good deal to symbolise the new spirit that exists in the best of our industries today, and which is rapidly spreading. They can lessen the differences which formerly divided nations and peoples into employers and employed, and, by indicating


the advantages which accrue from a better relationship, contribute to our future industrial prosperity.

Mr. A. E. Dram: In moving the Clause, the hon. Member for North Angus (Mr. Thornton-Kernsley) confessed that a great deal of it was complicated and involved. That is certainly true of the second paragraph. On first reading it, I found it extremely difficult, and decided that it called forth the qualities required for the two pastimes of which I am particularly fond—chess, in seeing three or four moves ahead, and cricket, in keeping one's eye on the ball. However, having tried to do both things at the same time, I confess I was stumped and checkmated at one and the same time. Nevertheless, the general drift of the Clause was clear, and it is in line with the speech of the hon. Gentleman.
The hon. Member claimed that tax exemption for these schemes is justified because they are socially desirable. I believe that the test of whether a scheme is socially desirable rests on the extent to which the workers are enabled to play a part in the control of the enterprise. In the schemes which have been mentioned, rarely are the workers enabled to have any real partnership in terms of exercising control over policy.
Reference has been made to the John Lewis Partnership. John Spedan Lewis has written two books in praise of the organisation which he has done much to build, but when we study what he has put forward, and when we look beyond the self-praise which he was so lavish in bestowing upon himself, we find that the control of the enterprise remains very much where it always was, with a small handful of directors. Incidentally, whatever the financial advantages may be to the workers in the organisation, we find that the financial advantages to those who set the thing going, the small group of directors, are very much greater.
The I.C.I. scheme has been mentioned. I have examined it to ascertain when and how the workers will be able to control the policy of the enterprise. A study of the provisions of the scheme, about which we heard so much a couple of years ago, will show that it will take 400 years before the workers can accumulate sufficient shares to equal the equity shareholding of the ordinary shareholders at the outset of the scheme. From the

point of view of control and participation in policy-making in the organisation, many of these co-partnership schemes are scarcely worth the paper on which they are written.
Instead, I believe that social desirability as a test is to be found in those societies, to which the hon. Member for Barry (Mr. Gower) referred, within the Co-operative movement. He included them in the general category of co-partnership. I assure him that there is an essential difference in principle between those schemes which are organised within the Co-operative movement and those like the John Lewis Partnership and the I.C.I. scheme and so on which are not organised on co-operative lines.
In a co-operative society one shareholder has one vote and one vote only. In organisations in the Midlands which are organised in the Co-operative Productive Federation that is a fundamental principle. It results in the fact that on the board of directors are workers who are elected by their fellow workers on the factory floor. That is democracy applied to industry. That is something which is socially desirable. That is something which is worthy of tax concessions.
If the Clause had been worded and defined in that sort of way, it would have deserved much more whole-hearted support than it deserves in its present shape. In that sort of co-operative co-partnership, we are moving forward to a better form of industrial organisation. The Government would be well advised to accept, now or in some other form, tax exemptions which encourage that; but I must confess that I am only lukewarm in my support for the new Clause as it now stands.

Mr. Donald Wade: I shall not embark at this late hour on political philosophy, but perhaps I can summarise my point of view by saying that I think that the Socialists during the last half century have been in error in putting so much faith in the transfer of ownership to the State, rather than trying to remove the differences between the two sides of industry; the Conservatives have been in error in presuming that the alternative to Socialism is capitalism, as we knew it in the early part of the century.
The only purpose of these two moderate and modest Clauses is to remove the discouragement to co-ownership in the existing tax provisions. Perhaps I should distinguish between co-ownership and co-partnership. Co-partnership does not necessarily involve the sharing of ownership and the holding of shares, while co-ownership implies some holding of shares by employees. I do not suggest that the holding of shares is the only condition necessary to successful co-ownership schemes. Such a scheme is most likely to succeed where there is a sharing of responsibility through joint consultation, the sharing of profits and the sharing of ownership.
Unfortunately, intentionally or otherwise, the transferring of shares to employees is now discouraged. A firm might be considering adopting some co-ownership scheme. If it allocates profits to the issuing of shares, or the buying-in of shares which are sold at less than market value to employees, it will find that it cannot set off that money against profits for taxation purposes. It is not allowed; but if a mere cash distribution is made to employees that is allowed. It is part of the expenses of the business. Therefore, there is a deterrent to the adoption of the share-issuing type of scheme. Then again, the employee, if he accepts a certificate for shares which the firm may reasonably have sold to him at less than the full market value, or may have given to him, he will find that he is mulcted in tax. To raise the tax he has to sell the shares, or else he has to pay it from his wages. That is not a good start to the adoption of a co-ownership scheme.
We have worked out what we think is a simple and fair method of dealing with this problem. The employee will not pay tax on the value of the shares issued to him, or on the difference between what he pays and the market value. He will not be mulcted in tax at the time of the issue of the shares. He will, however, pay if eventually he sells the shares. We had in mind the possibility of tax evasion, and for that reason we set a limit of £200 in any one year. I hope that the Economic Secretary will not say that, for technical reasons, the wording of the new Clauses is not satisfactory.
If the Chancellor will accept these Clauses in principle, we shall be only too glad to hear any suggestions for bettering the wording. I urge the Chancellor and the Economic Secretary seriously to consider our proposals, because there is no doubt that at present adoption of the sharing of ownership, which I believe is a valuable contribution to harmony in industry, is being hindered by these tax difficulties. I hope that the Economic Secretary will indicate good will and genuine interest in this matter by accepting our proposals.

Sir E. Boyle: I hope that before I resume my seat I shall be able to show the hon. Member for Huddersfield, West (Mr. Wade) that we on this side of the Committee reciprocate the genuine interest which I know that he and a great many other hon. Members have in this subject. We have had a learned discussion during the past hour. Perhaps I might say to the hon. Member for North Angus (Mr. Thornton-Kemsley) that I do not possess, but have read, "The Middle Way." I do possess, but have not read, the work of J. R. Green. As for "man cannot live by bread alone", I think most of us feel that an interval of bed is desirable. Therefore I shall not be too long in my remarks.
The hon. Member for North Angus moved a Clause whose broad intention can be summarised as follows—I make no apology for repeating the purpose of the Clause because, as he said, it is a complicated matter. The intention of his Clause is that if a company which pays a preference dividend also pays a charge for profit-sharing, the difference between the Profits Tax payable under the existing law and the tax which would be payable if a preference dividend were left out of account shall be ascertained and the Profits Tax shall be reduced by such proportion of the difference as the charge for profit-sharing bears to the profits.
As the hon. Member said, this Clause has particular reference to the problems and the work of the John Lewis Partnership, to which another hon. Member referred in an interesting and fair speech. In the John Lewis Partnership group of companies, the original idea, I understand, was to make payments to employees out of dividends and preference shares held by trustees on their behalf. However, in view of the fact


that such dividends would be subject to Profits Tax at the higher distributed rate, this scheme has had to be abandoned, and any profit-sharing which takes place under the present arrangement is done by paying the employees ordinary bonuses. Any such bonus is allowable as a deduction in computing the profits of the group of companies for Profits Tax, and thus, so far as the existing profit-sharing scheme is concerned, there is not really, I think, any Profits Tax point of grievance.
12.30 a.m.
What is troubling the John Lewis group—and this was raised by my hon. Friend the Member for St. Marylebone (Sir W. Wakefield) some years ago—is that the group has a very large proportion of its capital in the form of preference shares and the higher rate of Profits Tax payable on the preference dividends severely depletes the amount of money which otherwise would be available for distribution.
This brings up the very complicated point we have often discussed in previous debates on Finance Bills, and to which I myself have referred, namely, the problem which arises as a result of the incidence of Profits Tax on distributed profits of companies which have to provide for a high proportion of preference stock. I remember telling my hon. Friend the Member for Kidderminster (Mr. Nabarro) in the debate on the last Finance Bill in the autumn that that was why we felt unable to get rid of Profits Tax on undistributed profits altogether and concentrated the Profits Tax on distributed profits, because it would have been extremely unfair to have created great problems for companies of that kind.
I do not want to dilate upon the future of the Profits Tax, but I can assure my hon. Friend that we know the difficulties which the present Profits Tax structure causes to companies like the John Lewis Partnership, and, indeed, I think it is some evidence of our realisation that in this Budget we have increased Profits Tax on distributed and undistributed profits and have not concentrated the rise in Profits Tax on distributed profits only.
At the same time, as the Clause is drawn, it would obviously have very special relevance to the problems of the John Lewis Partnership. The Clause is designed primarily to assist one group of

companies with a particular capital structure. [Interruption.] It obviously would have special relevance to their problems. Therefore, while, as I say, we certainly take the greatest interest in this subject, my right hon. Friend would not like to accept this Clause tonight as it stands.

Mr. F. Beswick: Would the hon. Gentleman not say a word on what one may call the spiritual issues raised by the hon. Member for North Angus (Mr. Thornton-Kemsley), who waxed lyrical at the end of his speech about the enormous social advantages of that form of co-partnership? Would he say why he wants to encourage paying money in the form of shares rather than bonuses which employees may spend as they like? Why encourage this form of additional wages involved in this suggestion?

Sir E. Boyle: I would rather not get on to moral and spiritual issues at this hour of the night.
I have tried to meet the point of my hon. Friend's new Clause, and it is only fair that I should come to the Liberal new Clauses, which I shall deal with as concisely as I can. The first of what I may call the Liberal Clauses was intended to deal with the tax position of the company which sets up a co-partnership scheme. This Clause provides that if a scheme is approved by the Inland Revenue the company shall be entitled to a deduction in computing its profits for Profits Tax purposes.
In reply to the hon. Member for Bolton, West (Mr. Holt), I would say that the tax considerations which apply in cases of this description are complicated. It has been held by the courts, I understand, that if a company allots shares to its employees on favourable terms, that is, at below their market value, it is not entitled, in computing its profits, to deduct the difference between what the shares would have fetched in the market and what the employees paid for them. It seems probable that this decision would cover a case where the company made a bonus issue of shares out of accumulated profits and used some or all of these shares for an employees' share issue, or, indeed, used profits to pay up partly-paid shares already held by employees, and that in this kind of case also no deduction would be due to the company for the amount of profits which is applied in this way.
The position when a company buys shares for allocation to employees is, I agree, a more doubtful one, but if it were to buy them in a large block as a once-for-all operation, the sum involved would probably be held to be of the nature of capital, for which no tax deduction would be due. If, however, it did this year by year as a regular practice, its annual outgoings might certainly be held to be a deductible expense for tax purposes.
We have looked at this matter. The difficulty which the hon. Member for Bolton, West envisages is not one which has been found to arise in practice under recent schemes. This is not, so far as we know, a difficulty which has caused trouble. In these circumstances, my right hon. Friend does not feel that he can recommend the Committee to accept the Clause, which is, indeed, open to the objections that it seems to go further than is necessary and might involve the allowance as an expense of payments of a capital nature paid year by year. In view of recent legal practice, we do not think that the Clause is necessary and, as I have said, it might prove to go considerably further than is necessary or desirable.
The last point, which is raised by the second of the two Liberal new Clauses, is the suggestion that we should exempt the employees from any Schedule E liability in respect of shares which they receive on favourable terms under such schemes so long as they retain the shares. It is a Clause which deals with the position of employees. There is no doubt that the value of free shares, or the difference between the market value and the purchase price of shares for which the employees pay something, is an assessable emolument for Schedule E purposes.
The dangers of proposing tax exemption for any form of emoluments flowing to employees in respect of their work are fairly obvious and I need not dwell on them tonight. Whatever we feel about co-partnership, this can hardly be the right way to do it. There are many forms of wage payment or benefit in respect of which tax exemption has before now been sought. People have frequently suggested that overtime earnings, for example, should be exempted from tax, and all these suggestions have

had to be resisted on the ground that the Income Tax cannot distinguish between incomes according to the time when they were earned, the unpleasantness of the occupation, and so on. This suggestion would lead to perhaps wider results than the hon. Member intends.

Mr. Holt: The hon. Gentleman has missed the point. First, there would be no exemption from tax, and secondly, in relation to his example about overtime, no cash is received when an employee receives these share certificates. They are quite different from the overtime question. The employee would pay the tax only when he sells the shares; there would be no tax exemption.

Sir E. Boyle: What I said was that no doubt the value of these shares is an assessable emolument for Schedule E purposes. I tried to explain that there were, it seemed to me, real dangers about proposing tax exemption for anything that could reasonable be designed as an emolument. That would lead us into wider results than the hon. Member and his hon. Friend intended.
I am sorry that for the whole of my speech so far I have had to be somewhat negative in tone and I promise to the Committee that I will try to make up for that in the last two or three minutes. These are complicated matters and I have had to try to explain why I do not think any of the three new Clauses are in themselves satisfactory. I should, however, like to reaffirm categorically that the Government wish to encourage profit-sharing and co-partnership schemes.
The Prime Minister has been referred to. Perhaps I might also recall to the Committee what the Lord Privy Seal said upon this subject in June last year, almost exactly a year ago, in the general economic debate. My right hon. Friend said:
We should like the House in the opening months of this Parliament and the opening period of this Government to find better methods of conducting our industrial relations and better methods of conducting our affairs generally. We believe we can get them if we have the advantage of the sincere help of hon. Members in all parts of the House. We shall offer in respect of profit sharing that the Inland Revenue will help any firm to get ahead that wishes to bring in a good scheme likely to help its workers. We shall offer, in dealing with the general economic situation, all the resources


of the Government. We cannot work without the help of the T.U.C., or without the help of the people, and, above all, we cannot work without the help of this House."—[OFFICIAL REPORT, 16th June, 1955; Vol. 54a, c. 801.]
I can assure hon. Members that that pledge has been implemented, and that assistance has been given by the Inland Revenue during the last year upon this subject.
The help to be given by the Inland Revenue must be within the framework of the existing law. I have tried to explain to the two Liberal Members who have spoken that one of their Clauses does not seem to be necessary and that the other raises rather wider issues than the hon. Member who spoke to it realises. I re-emphasise what was said by my right hon. Friend last year. The Government, through the Inland Revenue, will give such assistance as they can to companies wishing to operate profit-sharing schemes, and I can assure hon. Members that we have by no means lost our interest in this extremely important subject.

Mr. Jay: The Economic Secretary's speech has been rather disappointingly negative, in view of the many statements we have had from the Prime Minister, the Chancellor of the Exchequer, the Lord Privy Seal and other Members of the Government in the past—perhaps even including the Postmaster-General. My advice to the hon. Member for North Angus (Mr. Thornton-Kemsley) is to bring his Clause forward in an improved form on Report, when he can give us a complete series of quotations from every Member of the Cabinet. Perhaps we shall then carry the matter further.
My feeling about profit-sharing and co-partnership schemes is that they are good as far as they go, but that they do not go very far. The Liberal Party has been here in very great force tonight. At one moment it appeared to have been joined by the hon. Member for Kidderminster (Mr. Nabarro).

Mr. Nabarro: Nothing of the sort.

Mr. Jay: Well, the hon. Member was applauding various Members of the Liberal Party from somewhere in their part of the House. The Liberal Party is a little inclined to think that the whole problem of the better distribution of wealth and incomes can be solved largely by these schemes. It seems to us that

it is going a good deal too far in thinking that. Even so, that does not mean that the schemes are not good in themselves. I believe that the proposal put forward by the hon. Member for North Angus is one of the most attractive and plausible that this Committee has had before it.
It is true that there is a technical flaw in the Profits Tax—which, in general, is a good tax—and that in the case of a company with a lot of preference capital it falls extremely heavily upon the equity shareholders. The hon. Member confined his suggestion to that sort of case, and also sought to safeguard the position by making the concession proportionate to the shares actually held by those benefiting by the co-partnership scheme. That is a considerable safeguard, and there is the further one, which is no doubt convenient from the point of view of the John Lewis Partnership, namely, that a high proportion of the employees have to be included in the particular scheme.
It is therefore rather disappointing that we have had nothing but a somewhat vague promise from the Economic Secretary. I suggest that the hon. Member for North Angus should try again on Report. If his Clause is brought forward then in an improved form, and we discuss it at a more appropriate hour, we may be able to give him our support in the Division Lobby.

Mr. Thornton-Kemsley: Whether or not I take the right hon. Member's advice, I have known my hon. Friend the Economic Secretary to be more forth-coming than he has been this evening, but I have been long enough a Member to know that once a Government have given their answer it does not do any good to go on pressing the matter in the same way at the same time. I therefore beg to ask leave to withdraw the Motion.

Hon. Members: No.

Question, That the Clause be read a Second time, put and negatived.

New Clause.—(AMENDMENT OF S. 32 (2) OF FINANCE ACT, 1954.)

(1) For the purpose of resolving doubts, subsection (2) of section thirty-two of the Finance Act, 1954 (which provides for the exemption from estate duty chargeable on property passing on the death of a surviving spouse, however small the principal value of the estate of the other spouse), shall, in the case of a surviving spouse dying after the commencement of


this Act, have effect, subject to the amendments set out in the following subsection.

(2) In the said subsection (2) there shall be inserted after the words "would have been" the word "either", and after the words "principal value" the words "or if the amount of the liabilities of the estate of the said other spouse had not exceeded the value of the assets thereof".—[Mr. Arbuthnot.]

Brought up, and read the First time.

12.45 a.m.

Mr. John Arbuthnot: I beg to move, That the Clause be read a Second time.

Mr. H. Wilson: On a point of order, Sir Charles. Before the hon. Member continues, would it be in order to move to report Progress so that we may hear from the Government exactly how far they hope to go tonight?

The Chairman (Sir Charles MacAndrew): I am afraid that I have called the hon. Member for Dover.

Mr. Arbuthnot: The purpose of this Clause is to amend Section 32 (2) of the Finance Act, 1954. It is concerned with the exemption from Estate Duty on the death of the second to die of parties to a marriage where duty was paid upon the death of the first to die on property of which the second to die was not competent to dispose. The exemption is contained in a number of statutory provisions, including the Finance Act, 1894, Section 5 (2), the Finance Act, 1898, Section 13, and the Finance Act, 1914, Section 14 (a).
Before 1954 duty had actually to be paid on the death of the first spouse to die. If no duty was paid, because at the date of the death the net value of the estate fell below the exemption limit, duty became payable on the death of the second spouse to die, even if he or she was not competent to dispose of the property. However, by Section 32 (2) of the Finance Act, 1954, it was provided, in effect, that in those circumstances duty would be deemed to have been paid on the first death, thus exempting the property from duty on the second death, even though no duty would actually have been paid on the first death.
The purpose of this new Clause is to clarify matters because doubts have now been expressed as to whether in fact the Section achieves this object in all the circumstances in which logically it should

apply. So far as it is relevant, the Section runs as follows:
For the purpose of the exemption from estate duty chargeable on property passing on the death of a surviving spouse, estate duty shall be deemed to have been paid on any property passing on the death of the other spouse, being property on which it was not payable, but would have been if the duty were payable on estates of however small a principal value …
We suggest that these words are not wide enough to comprehend the case where the first estate was insolvent. It is for that reason that my hon. Friend the Member for Langstone (Mr. Stevens) and I bring forward this new Clause.

The Solicitor-General (Sir Harry Hylton-Foster): I would present to the Committee the view that the Clause is obviously right in principle, that its aim and object are right. My hon. Friend the Member for Dover (Mr. Arbuthnot) has explained why it is needed and I have not to repeat the explanation.
When this House tried to put the matter right in 1954, it clearly did it in terms which meant that duty on the second death might be excused if the duty had not been paid on the first death because the estate fell below the exemption limit, but there remains the case of the estate which does not pay duty because it is insolvent and also, I suppose, the rather mythical case where the estate is exactly nil.
I cannot accept the wording of my hon. Friend's Clause which requires looking at. It says: "For the purpose of resolving doubts …" I think the Greeks had a word for that which was not monosyllabic. If my hon. Friend thought fit on this undertaking to withdraw the Clause, I have the authority of my right hon. Friend for saying that we would put down an appropriate Clause on Report stage to deal with the point he has in mind.

Mr. Mitchison: I have one question and one comment, and I make the comment first. The subsection we are here amending arose from the Government accepting an Amendment in the name of Mr. Ralph Assheton, as he then was, in preference to a cruder but fundamentally truer Amendment in the name of my right hon. Friend the Member for Bishop Auckland (Mr. Dalton). Attracted by the apparent simplicity of that


Amendment, they accepted it and now appear to be discovering their error.
I wish to ask the Solicitor-General one question, and I hope he will accept that it really puzzles me. Supposing we get an estate which appears to be a minus quantity, how at any stage could any duty be charged on it? I invoke the shades of Lewis Carroll, if they are present with us tonight, and would be glad of an explanation.

The Solicitor-General: I do not think duty could be charged on that estate. I think it is the case we want to see covered by the Clause. If the hon. and learned Member for Kettering (Mr. Mitchison) thinks that course appropriate, I will look at his words before the Report stage.

Mr. Arbuthnot: I wish to thank my hon. and learned Friend for the favourable reception he has given to the Clause. In view of what he said and, on the understanding that the Government will bring in a new Clause which will cover the point, I beg to ask leave to withdraw the Motion.

Motion and Clause, by leave, withdrawn.

Mr. H. Wilson: I beg to move, That the Chairman do report Progress and ask leave to sit again.
I want to make clear that, in moving this Motion, I do not necessarily intend to press it if the Chancellor can give us a reasonable understanding about what is likely to happen in the future course of our business tonight. It will be within the recollection of the Chancellor and of the Committee that we have now spent an hour and a half on new Clauses moved entirely by hon. Members opposite. Some of them, however, interesting and important, have been moved at inordinate length. I am not referring to the hon. Member for Dover (Mr. Arbuthnot), who spoke briefly.
We on this side of the Committee, I think the Chancellor will agree, have shown great restraint through the major part of the passage of this Bill in Committee. Certainly since 11.30 p.m. no new Clauses have been moved from this side of the Committee. If it is the desire of the Chancellor that we should go on until we have exhausted all the Tory new Clauses on the Notice Paper, which would appear to be the case, I

would appeal through you, Sir, to some hon. Members moving these not uninteresting but small Clauses to show the same restraint and forbearance we showed a couple of hours ago when we withdrew a new Clause in order to facilitate business and get on with the Bill. This is not really the job of the Opposition. Perhaps hon. Members opposite will show the same forbearance and postpone their important arguments to a later stage of the Bill.

Mr. H. Macmillan: I am very conscious of the co-operation which the whole Committee has shown in the course of the seven days we have so far spent on the Bill, and also of the help which the right hon. Member for Huyton (Mr. H. Wilson) has given to get our business through in as good a period of the day as we could. I understand that the next new Clause to be selected is that in the names of the hon. Member for Langstone (Mr. Stevens) and the hon. Member for Dover (Mr. Arbuthnot)—(Continuation of period for which mills and factories allowances may be given). It might be for general convenience if we took that new Clause and then the new Clause in the name of the same hon Members—(Stock valuation for inter-group sales). That will probably result in the first new Clause which we have to take at the next sitting being that in the name of the right hon. Member for Huyton—(Increase of relief in respect of insurance premiums paid by self-employed persons and non-pensionable employees). I think voting is reserved on two other Clauses. I think we could then finish the Committee stage in the course of the next sitting.

Mr. Wilson: That does not seem entirely unreasonable to us, in the co-operative mood we have been in throughout the Bill, but I want to make one general point. We have again seen—and this tends to happen late at night or early in the morning—a very complicated new Clause accepted by the Government, at any rate in principle, without the Committee being able to give it a thorough examination. There is no harm in this instance, because we gathered from the Solicitor-General that it will be necessary for the Government to put down their own Clause on Report. We shall therefore be able to consider it in plenty of time, take advice on it and


debate it, we hope, at a more reasonable hour—and I am sure that will please no one more than the hon. Member for Dover (Mr. Arbuthnot).
If there is any question of accepting any of the next new Clauses—and we have had some surprise acceptances of back bench Tory Amendments in the early days of the Committee Stage—it raises a very important principle, because some of us might feel that issues of principle are being given away in the early hours when it is difficult for the Committee fully to understand what is involved. Although we are quite agreeable to what the Chancellor has proposed, if there were any question of accepting these new Clauses we should be much against going on, unless there were an opportunity of re-examination on Report. With that understanding, I beg to ask leave to withdraw the Motion.

Motion, by leave, withdrawn.

New Clause.—(CONTINUATION OF PERIOD FOR WHICH MILLS AND FACTORIES ALLOWANCES MAY BE GIVEN.)

Part I of the Eleventh Schedule to the Income Tax Act, 1952, shall be amended by the substitution of the words "fourteen years" for the words "nine years" wherever they appear.—[Mr. Arbuthnot.]

Brought up, and read the First time.

Mr. Arbuthnot: I beg to move, That the Clause be read a Second time.
The purpose of the new Clause is to extend for a further period the allowance for mills and factories. When the new code of depreciation allowances for buildings was introduced, the existing mills and factories allowance was continued for a temporary period to meet the case of those factories which had been in existence for so long that they could not benefit from the new allowance and had received the mills and factories allowance for too short a period to permit them to be fully written off. Therefore, the Income Tax Act, 1945, permitted the taxpayers owning such factories to choose to continue under the mills and factories allowance for a further four years.
In the Finance Act, 1950, this permission was extended for a further five years, and the new Clause suggests that a further five years is now required. Many of these mills and factories exist in the cotton industry and were built about 50 years

ago, or perhaps a little more, and therefore got no allowance under the industrial buildings allowance which provided for 2 per cent. on the cost price, as reduced. They have not had the opportunity to set aside a tax-free fund sufficient for renewals because the old mills and factories allowance did not operate for a sufficient period and the new allowance is not applicable. We therefore propose in this new Clause to extend the old allowance at the option of the taxpayer for a further five years.

1.0 a.m.

Sir E. Boyle: I think I shall be able to save the Committee a little time. I find myself in a little difficulty in view of what the right hon. Member for Huyton (Mr. H. Wilson) has just said. It obviously would be imprudent of me, in view of his remarks, to accept this new Clause. On the other hand, I recall that the last time this allowance was extended, it was extended by the late Sir Stafford Cripps for five years, and I have no doubt that that might give the right hon. Member for Huyton some slight bias in favour of extending this allowance.
However, I will tonight, perhaps prudently—and my right hon. Friend the Chancellor of the Exchequer has asked me to do this—steer a middle course and say that this is a point that my right hon. Friend would like to look into and give further consideration to before Report. Perhaps on that understanding my hon. Friend would agree to withdraw the new Clause.

Mr. Arbuthnot: I am grateful to my hon. Friend for the favourable reception that he has given to the Clause and, in view of his assurance, I beg to ask leave to withdraw the Motion.

Motion and Clause, by leave, withdrawn.

New Clause.—(STOCK VALUATION FOR INTER-GROUP SALES.)

Where in the case of a number of bodies corporate to which this section applies one of those companies holds a stock of goods which have been acquired from another of those companies, it may value those goods at the same value as the company which sold those goods to it would have valued them if they had not been sold but had remained in the ownership of that company but were in the same condition and situation as they are at the accounting date of the first-named company. The difference between such value and the actual cost of the goods in their then


condition and situation may either be deducted from the value of the stocks or carried to a reserve on the liability side of the balance-sheet and, in either event, may be deducted in arriving at the trading profit of the first-named company for the purposes of the income tax and the profits tax.

The companies to which this section applies are the companies referred to in section twenty-two of the Finance Act, 1937, as amended by section forty-two of the Finance Act, 1938, for certain purposes of the profits tax.—[Mr. Arbuthnot.]

Brought up, and read the First time.

Mr. Arbuthnot: I beg to move, That the Clause be read a Second time.
This is the last new Clause that my right hon. Friend the Chancellor proposes to take tonight. It is, in fact, one that is almost self-explanatory, so I do not propose, therefore, to take up more time than necessary.
We feel that the concession which is asked for in this Clause on stock valuation for inter-group sales is a subject which, in equity, merits close consideration and, I hope, acceptance by my right hon. Friend the Chancellor of the Exchequer.

Mr. Mitchison: I hope this Clause will not be read a Second time. I do not like the look of it a bit, and I hope that at this late hour we are not going to have a hasty acceptance of the whole Clause, or a hasty acceptance of the underlying spirit of the Clause, or even a promise to look at it again, or one of these postdated cheques to the effect that it will be brought in on the next Budget and antedated to this one.
My objection to the Clause is very simple. I cannot see what the purpose of it is. I have not been enlightened in that respect by the hon. Member for Dover (Mr. Arbuthnot). I think his brief must have run a bit short at that point. So far as it seems to do anything, it appears to encourage one company in a group to sell at a fictitious or unreal figure to another company in the group, and then to get some kind of fiscal absolution for this somewhat unnecessary process. That, I feel certain, is the voice of ignorance.
I shall, no doubt, be sat upon quite heavily by the Solicitor-General, but I thoroughly mistrust it, and this is not the sort of hour at which to sanction fictitious sales and give them the blessing of the Chancellor of the Exchequer.

The Solicitor-General: The advantage, perhaps, to the hon. and learned Gentleman the Member for Kettering (Mr. Mitchison) in what I am about to say is that before this topic next appears he will be able to refresh his memory of what the Millard Tucker Committee said about it and what hon. Members opposite when they were the Government said about a parallel matter in 1951.
I confess that I thought that both sides of the Committee would really be in agreement in supporting the principle which underlies the Millard Tucker recommendation, and perhaps this Clause. Certainly there are cogent arguments which may be advanced in favour of it, but I cannot deal with those now.
I would say, whether with regret or not, that there is one argument over-whelmingly cogent to any Chancellor of the Exchequer, and that is one which necessarily obliges my right hon. Friend to say that he could not accept this important new Clause now. It is the firm and savage argument of cost. It is difficult to estimate precisely what the cost of the new Clause would be. It involves a once-and-for-all loss to the Revenue and, making the best approximate estimate we can make, it is about £25 million, so that no one knowing the aspects of this Budget to which my right hon. Friend has drawn attention could for a moment suppose, whatever the merits of the proposal may be—not now to be discussed—that that is a loss to the Revenue which could be accepted this year. In view of the hour, I would say in answer to my hon. Friend that I do not now discuss the merits, but I should be compelled on that ground alone to advise the Committee not to accept the new Clause now.

Mr. H. Wilson: It is a great relief to hear from the Solicitor-General that the Government have managed to dig their heels in somewhere. There seems to be a tendency at about midnight for the Government to give way sometimes to rather dangerous-looking Amendments from their own side of the Committee. The £25 million seems to have been a conclusive argument with the Chancellor, and we can understand that. After all, he could have saved four or five hours of discussion earlier for the sake of, I think, £1¾ million. He was obdurate about


that, and I am glad that he is being consistent now in not giving way on the £25 million in what appears to be an extremely dubious new Clause.
One of the big difficulties we are in when looking at Clauses such as this is that various hon. Members on both sides of the Committee, and right hon. Members on this side, have looked at the Millard Tucker Report or the Report of the Royal Commission and have produced an Amendment or new Clause to give effect to a particular proposal or recommendation in those Reports, or sometimes in the minority report of the Royal Commission. In many cases the Chancellor has refused to act, sometimes very much to our regret, but at a time when the Government are doing so little to bring forward recommendations based either on the Millard Tucker Report or the Report of the Royal Commission—with the exception of the special Millard Tucker Report on savings—of course—it would appear to us to be wrong for some of these quite small matters to be taken out of their context and given legislative effect.
The Chancellor will be aware that in the minority and majority Reports there are very long sections about the valuation of stocks, and there is a long appendix as well. The old and historical battle between "last in, first out" and "first in, first out," as they are known technically, is carried on at great length. It would be undesirable and wrong for the Government to accept so dubious a proposal without going very fully into the whole question of stock valuation, and particularly the "lifo" versus

"fifo" argument. I tend to support the general Inland Revenue view on "lifo" and "fifo," but I should be out of order—or certainly I should not be very popular—if I were to embark on that at any length now. I am sure that the Solicitor-General was right to recommend the Committee to reject this new Clause.

Mr. Arbuthnot: If the hon. and learned Member for Kettering (Mr. Mitchison) would like it, I could go into great detail giving reasons for the new Clause, but I thought that hon. Members on both sides of the Committee knew the Report on which it was based so well and had studied it for so long that at a late hour like this it could be taken as read and everybody would realise what it was all about.
I should like to say how grateful I am to my hon. and learned Friend the Solicitor-General for the courteous terms in which he felt it necessary to turn down the new Clause. I hope that I would not be wrong in reading into what he said that, when the financial condition of the country is less stringent than it is today, my right hon. Friend the Chancellor of the Exchequer will find it possible in a later Budget to accept the new Clause. In view of what the Solicitor-General has said, I beg to ask leave to withdraw the Motion.

Motion and Clause, by leave, withdrawn.

To report Progress and ask leave to sit again.—[Mr. H. Macmillan.]

Committee report Progress; to sit again this day.

KENYA (DETAINED PERSONS)

Motion made, and Question proposed. That this House do now adjourn.—[Colonel J. H. Harrison.]

1.12 a.m.

Mr. A. Fenner Brockway: The fortune of the ballot has given me this very late hour in which, nevertheless, I intend to raise a very important issue. It is the question of the condition of juveniles in prisons and detention camps in Kenya. In a speech which I delivered during a debate on Kenya on 16th June, I made four charges in regard to this matter, which were based on the evidence of Miss Eileen Fletcher.
First, I gave three cases of children who had been sent to Kenya prisons two years ago under 14 years of age. Secondly, I gave instances of how they had been employed on hard and heavy labour. Thirdly, I gave an instance of how they had been kept in solitary confinement for 16 days. Fourthly, I gave evidence that unaccompanied children of under eight years of age had been left in detention camps.
It will be impossible for me in the brief time in which I can speak now to deal with all these points. I shall develop the first point regarding children under 14 years of age, but I would say that the Colonial Office has completely failed to deny all these points which I made in that speech. I propose to make only a brief comment on one point other than that relating to children under 14 years of age in these prisons. It relates to solitary confinement for juveniles in the prisons of Kenya for 16 days. The maximum solitary confinement permitted in prisons in this country, for adults in large modern prison cells, with air and sanitary arrangements, is, by order of the governor of the prison, three days. Even when solitary confinement is given by a visiting committee it is limited to 15 days. Yet the right hon. Gentleman, in reply to a Question by me, has admitted that juveniles in the prisons of Kenya can be sentenced to 16 days' solitary confinement. That is a disgrace which I hope the right hon. Gentleman will very rapidly end.
I propose to devote most of my remarks to the charge that children of 11 and 12 were imprisoned in Kenya two years ago. I gave three cases in my speech. One was No. 13222, who was said in the prison records to be 11 years of age, and who had been sentenced to seven years' hard labour. The other cases were Nos. 12795 and 7966, who were said in the prison records to be 12 years of age and to be detained in prison according to the Governor's pleasure.

The Secretary of State for the Colonies (Mr. Alan Lennox-Boyd): Would the hon. Gentleman repeat those numbers? I did not quite catch them.

Mr. Brockway: They are exactly the same numbers as I gave in my speech. My time tonight is limited. They are Nos. 13222, 12795 and 7966.
In reply to these three specific charges, the right hon. Gentleman said:
Under Kenya legislation no child under the age of 14 may be sentenced to imprisonment, and there are no children under that age in prison in Kenya.
The right hon. Gentleman admitted that on 19th May the Governor of Kenya had informed him that there were five girls of 13 years of age and one of 12 serving prison sentences at Kamiti, but he stated that on 29th May this was corrected by the Governor saying that there was an inaccuracy in the prison records.
Even if we accept the Governor's correction, these juveniles were, according to him, aged 15. They had been medically examined. The right hon. Gentleman said they were circumcised women, and were regarded as adult members of the Kikuyu tribe. I make two comments. If they were 15 years of age on 19th May this year, they were 13 years of age in August, 1954, when charged. Secondly, as to their being circumcised women and regarded as adult members of the Kikuyu tribe, there is the very objectionable practice of circumcising girls at 11 and 12 years of age, and that is no evidence whatsoever that they were over that age at that time.
The right hon. Gentleman was good enough to say in relation to myself that I was quite entitled to be misled by what is actually a prison record error, and he added:
In a matter of this kind, where the good faith of the Secretary of State and, what is really more important, of the Government of


Kenya is involved, I would ask hon. Members to believe definitely that the story that I had given is the true story, a regrettable mistake—"—[OFFICIAL REPORT, 6th June, 1956; Vol. 553, c. 1209–11.]
I think I shall be able to show that the right hon. Gentleman's story was not as accurate as he suggested.
A week later I followed up that speech by asking how it came about that the official records showed that No. 13222 was 11 and Nos. 12795 and 7966 were 12. In reply, the right hon. Gentleman concentrated on the case of No. 13222, and explained that the age had been altered in the prison records from 18 to 11. I think that I am within the recollection of the House when I say that everyone who heard the right hon. Gentleman make that statement about one particular case assumed that the inaccuracies in the prison records applied to all children stated to be under 14. Indeed, the right hon. Gentleman said:
I am deliberately concentrating on the age of this particular prisoner, the first on the list of the hon. Member for Eton and Slough (Mr. Fenner Brockway) which was put down as 18.
Indeed, in the course of his answers the right hon. Gentleman added:
I also stand by everything that I said during the debate …"—[OFFICIAL REPORT, 13th June, 1956; Vol. 554, c. 569.]
namely, that there had been no child under 14 in prison.
The following week, on 20th June, I therefore returned to the two cases 12795 and 7966 about which the right hon. Gentleman had not replied. I asked him the minimum age at which a person sentenced to detention during the Governor's pleasure could be placed in prison in Kenya and whether, in those cases, the entries in the prison records stating them to be 12 years of age were subsequently altered. Earlier, there had been a Question from my hon. Friend the Member for Rugby (Mr. J. Johnson). There were many supplementary questions. There was still no acknowledgment by the right hon. Gentleman that children under 14 could be confined in prison in Kenya.
However, on the same day in a Written Answer to me the right hon. Gentleman acknowledged that, in the case of a person held to be criminally responsible—I understand that in Kenya it is the same

as in this country, eight years of age—there was no minimum age for the detention in prison of persons sentenced to be detained under the Governor's pleasure. He went on to say that the ages of the two juveniles to whom I referred were given in the court proceedings as "under 18" and "about 12." He said that on entry into prison they were each held to be 12 years of age, and he added that in their cases there were no subsequent corrections of those prison records.
I brought before him three cases. In one there had been an alteration of age. He concentrated on that and did not reveal to the House the ages of the other two, although at the same time in a Written Answer he acknowledged that there is no subsequent correction of those two cases. He said:
The prison records showed the age as 12 in both cases and there were no subsequent alterations.
On that evidence it is clearly untrue that children under 14 could not be confined in prisons in Kenya. He gave to the House the impression that the allegation by Miss Fletcher was not justified and yet, in a Written Answer to me, he acknowledged that children under that age could be imprisoned.
Perhaps he will say that these children are detained rather than imprisoned. My answer is that they have exactly the same treatment as children sentenced to terms of imprisonment, they live in the same huts, suffer the same discipline, undergo the same labour and are accommodated in the same compounds. The right hon. Gentleman was very scathing with my right hon. Friend the Member for Ebbw Vale (Mr. Bevan) who described these children as "lifers". The right hon. Gentleman spoke of
… the mischief that can come from sweeping charges unrelated to the facts."—
That was his comment upon a supplementary question of my right hon. Friend the Member for Ebbw Vale. It is the Secretary of State for the Colonies himself who has not ascertained the facts. The right hon. Member for Ebbw Vale was correct in saying that the official prison records referred to these cases as "lifers". I quoted a document in my speech of 6th June, dated the 12th May, 1955, signed by the commandant of the prison, referring to these juveniles as "lfers". I now quote another document,


the Monthly Report for June, 1955, dated 27th June and signed by the Commandant of Kimati Prison, Mr. C. B. Alison. Referring to juvenile prisoners, he says,
Schools for 26 life imprisonment convicts (female), and 36 long term convicts, continued their good work under the supervision of Miss Fletcher.
These life imprisonment convicts included the two girls to whom I referred in my questions. The distinction was deliberately made between juveniles who were there under the Governor's pleasure, described officially as "life imprisonment convicts" and those described as "long term convicts"; yet the right hon. Gentleman dared to use the kind of words which he addressed in this House to the right hon. Member for Ebbw Vale when he described them in a similar way.
He said that the statement of the right hon. Member for Ebbw Vale that they were kept in prison indeterminately, subject only to review once every four years, was inaccurate. The right hon. Gentleman said:
Once more the right hon. Gentleman enters the lists without having troubled to ascertain the facts".—[OFFICIAL REPORT, 20th June, 1956; Vol. 554, c. 98, 1414–15.]
The right hon. Gentleman remarked that it is up to the Governor at any time he likes, without waiting for four years to elapse, to look at every case in the light of the circumstances. Of coure it is in the power of the Governor. These sentences are at his pleasure; but the accepted practice in Kenya is that the review shall take place every four years. I ask the right hon. Gentleman, whether there is a single case since 1954 in which the Governor's pleasure has been used to release a juvenile prisoner before the four years' review. The right hon. Gentleman remarked that he wished that the right hon. Member for Ebbw Vale would trouble to ascertain the facts before he lent his oratory to the mischievous continuance of untruths. I would be out of order if I described the replies of the right hon. Gentleman on these occasions as dishonest, but I do say that they were grossly misleading.
The review of the facts which I have given in this brief speech shows that it is the Minister who has given an untrue impression to the House and to the country of the facts regarding these juvenile prisoners. There are no children under

the age of 14 in prison in Kenya, he said; yet in his Written Answer to me he acknowledges that children can be sent to prison under that age and does not deny that in two of the three cases which I gave him the ages had not been altered. I submit that I have proved that children under 14 can be sent to prison in Kenya, and that Miss Eileen Fletcher's evidence that there were children of that age under her care in Kimati Prison in 1954 is undisputably true.

1.30 a.m.

The Secretary of State for the Colonies (Mr. Alan Lennox-Boyd): I am sorry that my hon. Friend the Member for Armagh (Mr. Armstrong), who wanted to add a few words to this debate, has been prevented from doing so by the shortness of the time available. I hope another opportunity will arise for someone like him, with such close personal experience of Kenya, to be able to add his contribution.
The hon. Member for Eton and Slough (Mr. Fenner Brockway) will recollect, I think, that when I was last asked a Question on 20th June in this House as to whether I proposed that there should be an inquiry, I said:
What I am proposing to do is to assemble all the information, which is being most carefully gathered—and my asking the Attorney-General of Kenya to come was an indication that I intended to take any such suggestions very seriously—to assemble this information and then find the appropriate means of letting hon. Members have access to all the information to which I have access myself."—[OFFICIAL REPORT, 20th June, 1956; Vol. 554, c. 1415.]
I think it may be argued by those most anxious to get at the truth and not to score points in a discussion of this kind that further discussion of these charges might well await my being able to produce for the information of my colleagues all the information which is available to me and after discussion with Miss Fletcher all the information she has made available to us.
A very full record of a very long meeting Miss Fletcher had in my office, lasting over two hours, has been prepared, was sent to Mr. Foot with his agreement for his concurrence. When agreed, this will be sent to the Government of Kenya for their comments, and—I hope this will be so—Miss Fletcher will be considering which of the statements which she has made she would be prepared to put into


a statutory declaration. I would repeat that if we are really anxious to discern the truth in each one of these charges, we should be better employed in waiting until that information has been made available.
The hon. Gentleman made one general charge, of course, as he, no doubt, felt obliged to do, against what he called my lack of candour. If he will look at Hansard for 13th June, he will see that in a long oral examination of this matter at Question Time I said:
Under Kenya legislation no child under the age of 14 may be sentenced to imprisonment. A person under 18 who is convicted by a court on a capital charge must be sentenced to detention during the Governor's pleasure and such detention may be in prison."—[OFFICIAL REPORT, 13th June, 1956; Vol. 554, c. 567.]
I deliberately inserted those words to make quite certain that the House was not misled by the circumstances of these cases, and those words were inserted with the full intention that Parliament should be given that fact, as, indeed, every other fact at my disposal.
Very briefly, because time, alas, is not adequate for me to deal in detail with the hon. Gentleman's charges, here are one or two comments upon them. He raised the question of the detainees. There are 30 male detainees aged 13 at Wamumu and one aged 12 at Makurweini, but I think he knows that the detainees are in fact in approved schools—the male detainees.

Mr. Fenner Brockway: The male detainees, yes.

Mr. Lennox-Boyd: The male detainees are in approved schools. All the 47 female detainees in the 14–17 age group are at Kamiti and there are no female detainees under 14 years of age.

Mr. Fenner Brockway: rose—

Mr. Lennox-Boyd: I cannot give way, for I have not much time in which to answer the hon. Gentleman's sweeping charges.
As to the children sentenced to imprisonment, I repeat that no child under the age of 14 years may be sentenced to imprisonment. The imprisonment of young persons between 14 and 18 is governed by the Ordinance, and only in exceptional circumstances do the courts order imprisonment. Wherever possible,

they find other punishments than imprisonment, probation, fines, corporal punishment, or committal to a remand home.
I wish I had time to deal in greater detail with more of the statements made, but once more I would deal again with the three particular cases. 13222/J, Nyakaru, wife of Gitonga, was convicted on 21st September, 1954, by the Resident Magistrate at Nyeri, sitting at Nanyuki, on two counts of taking illegal oaths, to which she pleaded guilty, and was sentenced to two years' and five years' imprisonment, the sentences to run consecutively. The sentence was confirmed on 30th September, 1954, by Mr. Justice Rudd. Her age was given on the charge sheet as "Adult". It was entered on the prison record at 18 and was subsequently, as I told the House, altered by some person unknown to 11. On 8th June, 1956, a medical officer determined her age as then being 15½—that is, nearly 14 at the time of conviction—while the three Kikuyu women of equivalent standing to tribal elders determined her age then to be 18½—that is, 16½ on conviction. I do not believe that anybody would quarrel with the accuracy likely to be obtained in this very difficult sphere by Kikuyu women of that type.
The second case mentioned by the hon. Member was, as I have it, 12795/J, Nyamburu, daughter of Kanyoru, convicted on 20th September, 1954, by the Supreme Court, Nairobi, on the capital charge of consorting with an armed person, ten other persons being charged with her. The court determined her age to be under 18 and she could not, therefore, be sentenced to death. She was, therefore, sentenced to be detained during the Governor's pleasure.
The prison record sheet gives her age as 12 and there has, as I said, been no alteration to this figure. On 8th June, the medical officer determined her age as then being 15—that is, 13 on conviction—while the panel of three Kikuyu women determined her age then to be 18, or 16 on conviction. I repeat, however, that she was sentenced to be detained during the Governor's pleasure. That is not a life sentence and it means exactly what it says: that the Governor is perfectly free to re-examine the case and is not bound by the general tradition that four years elapse before such examination takes place.
The third case which the hon. Member mentioned is 7966/J, Wanjiro, daughter of Kariro, who was convicted on 12th June, 1954, by the Supreme Court, Thika—Acting Judge Clive Salter—again on the capital charge of consorting with armed persons. The judge recorded the evidence of a medical officer that the prisoner was then about 12½ years old. As she was under 18, the court could not sentence her to death and sentenced her to detention—again, during the Governor's pleasure. I repeat that that gives the Governor absolute discretion to use his own discretion in deciding at any time to terminate the sentence.
The prison record shows her age as 12 and there was no alteration in this figure. On 8th June, the medical officer determined her age to be 15½ then—that is, 13½ on conviction—while the panel of Kikuyu women determined her age then to be 20—that is, 18 on conviction.
I recognise that there is something a little unsatisfactory in the method of keeping the various ages of juveniles who come before the court. The present arrangement—I hope I have two minutes more to explain this—is that an African warder/clerk makes out a record sheet from the commitment warrant and the answers of the prisoner. In normal times, this function would be performed by a European prison officer. The Prisoner's age is not shown on the commitment warrant, which shows only whether the court sentenced the prisoner as a juvenile or as an adult.
It is perfectly reasonable to assume that some people in this position are inclined not to tell the truth about their age when they get to prison, putting it as too low in the belief that they may thereby get a quicker release and lighter work. The prisoner then goes before the

medical officer, who merely certifies fitness for work. The record sheet and the prisoner then go to the officer in charge, who considers the medical officer's certificate regarding fitness for work and assesses age only in regard to work and segregation as a juvenile. I think that there is a need to make certain that the finding of the court in regard to age is transmitted by means of the warrant to the prison officer taking custody of the prisoner. This would be a worth while improvement and would prevent a good deal of misunderstanding.
On the general question whether or not there should be very severe punishment for juveniles, I would respectfully remind the House that some of these youthful prisoners have a horrifying maturity in crime. They have been brutalised by months of association with Mau Mau in the forests and we have, unhappily, considerable evidence of their general debasement and their persistent attempts to incite others to mutiny.
Until the Mau Mau tragedy is completely cleared up, it is essential not to lose sight of the fact that some of the people of whom we are talking as if they were juveniles in the strict sense of the term have themselves played a terrifying rôle in the Mau Mau conspiracy. I am at all time anxious that the information I give the House should be strictly accurate, and I can only ask those hon. Members who are concerned with getting the truth, and with no other purpose, to await the marshalling of all the evidence, which I have promised the House I will do as soon as I can.

Adjourned accordingly at nineteen minutes to Two o'clock.